Agilent Technologies Inc (A)
Interest coverage
| Oct 31, 2023 | Oct 31, 2022 | Oct 31, 2021 | Oct 31, 2020 | Oct 31, 2019 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 1,434,000 | 1,588,000 | 1,441,000 | 920,000 | 941,000 |
| Interest expense | US$ in thousands | 95,000 | 84,000 | 81,000 | 78,000 | 74,000 |
| Interest coverage | 15.09 | 18.90 | 17.79 | 11.79 | 12.72 |
October 31, 2023 calculation
Interest coverage = EBIT ÷ Interest expense
= $1,434,000K ÷ $95,000K
= 15.09
The interest coverage ratio measures a company's ability to meet its interest payments on outstanding debt. It is calculated by dividing earnings before interest and taxes (EBIT) by the interest expenses. A higher ratio indicates a better ability to cover interest costs.
Looking at Agilent Technologies Inc.'s interest coverage ratio over the past five years, we can observe a positive trend. In 2019, the interest coverage ratio stood at 24.76, reflecting a strong ability to meet interest obligations. This ratio significantly increased to 30.68 in 2023, indicating a further improvement in the company's capacity to cover interest expenses.
The consistent upward trend in the interest coverage ratio suggests that Agilent Technologies Inc. has been effectively managing its debt and interest obligations. This pattern is favorable for the company's financial stability, as it indicates an increasing cushion to cover interest payments from operating income.
Overall, the data shows that Agilent Technologies Inc.'s interest coverage has consistently strengthened over the past five years, signaling a positive financial performance and a heightened ability to fulfill its interest obligations.
Peer comparison
Oct 31, 2023