Yelp Inc (YELP)
Financial leverage ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Total assets | US$ in thousands | 1,014,720 | 1,015,920 | 1,050,530 | 1,154,950 | 1,070,700 |
| Total stockholders’ equity | US$ in thousands | 749,534 | 710,324 | 751,318 | 854,534 | 754,991 |
| Financial leverage ratio | 1.35 | 1.43 | 1.40 | 1.35 | 1.42 |
December 31, 2023 calculation
Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $1,014,720K ÷ $749,534K
= 1.35
The financial leverage ratio measures the extent to which a company relies on debt to finance its operations and growth. A higher ratio indicates higher financial leverage, implying that the company has more debt relative to its equity.
Analyzing Yelp Inc's financial leverage ratio from 2019 to 2023, we observe fluctuations ranging from 1.35 to 1.43. The ratio peaked at 1.43 in 2022 and remained relatively stable around 1.40 in 2021 before decreasing to 1.35 in both 2020 and 2023.
The downward trend in the financial leverage ratio from 2022 to 2023 suggests that Yelp Inc reduced its reliance on debt financing compared to the previous year. Lower financial leverage can imply reduced financial risk and improved financial stability, as the company may have opted to rely more on equity financing.
Overall, analyzing Yelp Inc's financial leverage ratio over the past five years indicates a fluctuating trend, with a recent decrease suggesting a shift towards a more conservative capital structure.
Peer comparison
Dec 31, 2023