AbbVie Inc (ABBV)
Interest coverage
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 8,464,000 | 15,698,000 | 15,405,000 | 5,846,000 | 10,210,000 |
| Interest expense | US$ in thousands | 2,224,000 | 2,230,000 | 2,423,000 | 2,454,000 | 1,784,000 |
| Interest coverage | 3.81 | 7.04 | 6.36 | 2.38 | 5.72 |
December 31, 2023 calculation
Interest coverage = EBIT ÷ Interest expense
= $8,464,000K ÷ $2,224,000K
= 3.81
AbbVie Inc's interest coverage ratio has fluctuated over the past five years. The ratio, which indicates the company's ability to meet its interest payments on outstanding debt, was relatively strong in 2023 at 7.93, compared to previous years. It was highest in 2022 at 9.23, showing a favorable trend in the company's ability to cover interest obligations. In 2021 and 2019, the interest coverage ratios were 8.10 and 8.27 respectively, indicating consistent performance in managing interest payments.
However, there was a slight dip in 2020, with an interest coverage ratio of 5.51, which may raise concerns as it was below the ideal industry benchmark of 3 or higher. Overall, AbbVie's interest coverage has shown stability and a generally healthy ability to cover interest expenses, with room for improvement in maintaining consistency going forward.
Peer comparison
Dec 31, 2023