Valmont Industries Inc (VMI)
Financial leverage ratio
| Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 3,477,450 | 3,486,180 | 3,615,840 | 3,604,490 | 3,557,000 | 3,621,730 | 3,674,750 | 3,581,480 | 3,447,250 | 3,411,260 | 3,404,140 | 3,008,080 | 2,953,160 | 2,923,910 | 2,831,840 | 2,757,580 | 2,807,220 | 2,725,440 | 2,711,740 | 2,645,990 |
| Total stockholders’ equity | US$ in thousands | 1,354,280 | 1,501,740 | 1,612,220 | 1,540,100 | 1,580,850 | 1,512,730 | 1,488,380 | 1,476,050 | 1,386,850 | 1,318,140 | 1,294,620 | 1,224,810 | 1,182,060 | 1,162,440 | 1,126,840 | 1,087,410 | 1,144,340 | 1,086,690 | 1,081,740 | 1,078,260 |
| Financial leverage ratio | 2.57 | 2.32 | 2.24 | 2.34 | 2.25 | 2.39 | 2.47 | 2.43 | 2.49 | 2.59 | 2.63 | 2.46 | 2.50 | 2.52 | 2.51 | 2.54 | 2.45 | 2.51 | 2.51 | 2.45 |
December 31, 2023 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $3,477,450K ÷ $1,354,280K
= 2.57
The financial leverage ratio of Valmont Industries Inc has exhibited fluctuations over the past few quarters, ranging from 2.24 to 2.63. This ratio provides insights into the company's level of debt relative to its equity. A higher financial leverage ratio indicates a higher reliance on debt financing, which can amplify returns when operating income exceeds the cost of debt but also increases financial risk.
Analyzing the trend, it appears that the financial leverage ratio has generally been above 2, reflecting a significant level of debt compared to equity. The recent decrease in the ratio from 2.63 in June 2021 to 2.24 in June 2023 suggests a potential reduction in debt or an increase in equity during this period.
It is essential for investors and stakeholders to closely monitor changes in the financial leverage ratio as it can impact the company's financial stability and ability to manage debt obligations. A consistent downward trend in the ratio may indicate a healthier financial position with lower financial risk, while a continuous increase could signal heightened leverage and potential financial strain.
Peer comparison
Dec 31, 2023