K Wave Media Ltd. Warrant(Kwmww) Financials: Financial Leverage Compared To Industry Average, Plus Other Key Ratios
Solvency Trend (Last 5 Years)
Solvency - financial leverage
This chart shows the historical trend of financial leverage for KWMWW compared to its industry average over the recent years.
Ratio Definition and Interpretation
Name: Financial Leverage
Definition: Financial leverage tells you how much borrowed money the company uses to boost its size and profits. Using leverage can help a business grow faster, but it also increases pressure if sales slow down. Moderate leverage is common and often healthy. Excessive leverage can be dangerous, especially during tough economic times.
Interpretation:
• In '2023', KWMWW's financial leverage was 1.46, indicating how much debt is used to finance assets. Industry average for Movies/Entertainment in '2023' stood at 0.40.
• In '2024', KWMWW's financial leverage was 3.84, indicating how much debt is used to finance assets. The increase compared to '2023' may signal growing financial pressure. Industry average for Movies/Entertainment in '2024' stood at 1.81. Industry average increased by 1.41 compared to previous year.
Overall, KWMWW's financial leverage has been volatile but showed an upward trend over the past 2 years.
Formula: Financial Leverage = Average Total Assets / Average Shareholders' Equity
Good Range: 1 to 3 common; above 3 may indicate high leverage risk.