Woodward Inc (WWD)
Financial leverage ratio
| Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | ||
|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 4,010,200 | 3,806,450 | 4,091,000 | 3,903,340 | 3,956,530 |
| Total stockholders’ equity | US$ in thousands | 2,070,990 | 1,901,120 | 2,214,780 | 1,992,680 | 1,726,740 |
| Financial leverage ratio | 1.94 | 2.00 | 1.85 | 1.96 | 2.29 |
September 30, 2023 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $4,010,200K ÷ $2,070,990K
= 1.94
Woodward Inc's financial leverage ratio has fluctuated over the past five years, ranging from 1.85 to 2.29. The ratio indicates the extent to which the company relies on debt financing as opposed to equity. A high leverage ratio suggests a higher level of financial risk as the company has more debt relative to equity. Woodward's leverage ratio decreased from 2.29 in 2019 to 1.94 in 2023, indicating a reduction in debt relative to equity over the period. This may signify a more conservative approach to financing and a lower risk profile for the company. However, further analysis of the company's overall financial health and its ability to generate returns on its assets and equity is necessary to fully assess the implications of the changes in the leverage ratio.