Trimble Inc (TRMB)
Financial leverage ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 9,539,300 | 7,269,000 | 7,099,600 | 6,876,900 | 6,640,700 |
| Total stockholders’ equity | US$ in thousands | 4,500,100 | 4,050,200 | 3,944,700 | 3,596,900 | 3,119,000 |
| Financial leverage ratio | 2.12 | 1.79 | 1.80 | 1.91 | 2.13 |
December 31, 2023 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $9,539,300K ÷ $4,500,100K
= 2.12
The financial leverage ratio of Trimble Inc has exhibited fluctuations over the past five years. The ratio has ranged from 1.79 to 2.13 during this period. In 2023, the financial leverage ratio stands at 2.12, indicating an increase compared to the previous year.
A financial leverage ratio above 1 suggests that the company relies more on debt financing than equity financing to support its operations and growth. A higher financial leverage ratio signifies a higher level of financial risk due to increased debt obligations, as well as potential for higher returns on equity.
The trend of increasing financial leverage ratios from 2020 to 2023 may indicate that Trimble Inc is taking on more debt relative to its equity over time. It is essential for the company to manage its debt levels effectively to ensure sufficient financial stability and avoid potential liquidity or solvency issues in the future.
Further analysis of Trimble Inc's overall financial health and performance, in conjunction with other key financial ratios and metrics, would provide a more comprehensive understanding of the company's capital structure and risk management strategies.
Peer comparison
Dec 31, 2023