Asbury Automotive Group Inc (ABG)

Interest coverage

Dec 31, 2023 Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Sep 30, 2022 Jun 30, 2022 Mar 31, 2022 Dec 31, 2021 Sep 30, 2021 Jun 30, 2021 Mar 31, 2021 Dec 31, 2020 Sep 30, 2020 Jun 30, 2020 Mar 31, 2020 Dec 31, 2019 Sep 30, 2019 Jun 30, 2019 Mar 31, 2019
Earnings before interest and tax (EBIT) (ttm) US$ in thousands 953,400 1,131,500 1,180,400 1,228,200 1,272,500 1,206,000 1,093,400 976,300 791,800 690,200 608,300 472,100 370,800 315,400 278,500 282,200 325,000 323,200 321,800 315,500
Interest expense (ttm) US$ in thousands 165,700 161,400 161,300 159,600 159,800 172,600 148,800 125,600 102,100 61,100 59,200 56,600 59,600 58,700 59,700 61,700 58,600 58,300 57,600 57,000
Interest coverage 5.75 7.01 7.32 7.70 7.96 6.99 7.35 7.77 7.76 11.30 10.28 8.34 6.22 5.37 4.66 4.57 5.55 5.54 5.59 5.54

December 31, 2023 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $953,400K ÷ $165,700K
= 5.75

The interest coverage ratio for Asbury Automotive Group Inc has shown positive trends throughout the quarters provided in the table. The ratio has consistently remained above 6, indicating that the company's earnings before interest and taxes (EBIT) are more than sufficient to cover its interest expenses. The highest interest coverage ratio was observed in Q4 2022 at 7.90, indicating a strong ability to meet interest obligations.

Overall, the company's interest coverage ratio has remained relatively stable, with slight fluctuations quarter to quarter but generally staying within a healthy range above 6. This suggests that Asbury Automotive Group Inc is effectively managing its interest expenses and has a comfortable cushion to handle its debt obligations. Investors and creditors typically view a higher interest coverage ratio as a positive indicator of financial health and ability to service debt.