Viatris Inc (VTRS)
Financial leverage ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 47,685,500 | 50,022,200 | 54,842,800 | 61,553,000 | 31,255,500 |
| Total stockholders’ equity | US$ in thousands | 20,467,400 | 21,072,300 | 20,492,700 | 22,954,100 | 0 |
| Financial leverage ratio | 2.33 | 2.37 | 2.68 | 2.68 | — |
December 31, 2023 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $47,685,500K ÷ $20,467,400K
= 2.33
The financial leverage ratio of Viatris Inc has shown a slight decrease from 2.37 in 2022 to 2.33 in 2023. This indicates that the company's reliance on debt to finance its operations has decreased marginally. However, when compared to the ratios in 2021, 2020, and 2019, the current ratio of 2.33 is still higher. This suggests that Viatris Inc continues to maintain a relatively high level of financial leverage, with a significant proportion of its operations funded by debt.
A financial leverage ratio of 2.33 indicates that for every dollar of equity, Viatris Inc has $2.33 of debt. While debt can provide tax benefits and leverage returns for shareholders, it also increases the financial risk of the company, as higher levels of debt could lead to financial distress if not managed effectively.
It is important for investors and stakeholders to monitor Viatris Inc's financial leverage ratio over time to assess the company's ability to meet its debt obligations and manage its financial risk appropriately.
Peer comparison
Dec 31, 2023