Advanced Energy Industries Inc (AEIS)
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 | 113,694 | 158,025 | 205,536 | 228,476 | 233,095 | 217,204 | 163,841 | 152,156 | 151,681 | 165,256 | 200,001 | 194,397 | 176,023 | 142,440 | 92,876 | 92,321 | 79,086 | 77,576 | 108,128 | 128,759 |
| Interest expense (ttm) | US$ in thousands | 16,567 | 11,123 | 9,437 | 8,074 | 6,607 | 5,299 | 4,466 | 4,107 | 3,969 | 4,032 | 3,801 | 3,967 | 5,081 | 6,313 | 6,238 | 5,151 | 3,108 | 874 | 228 | 228 |
| Interest coverage | 6.86 | 14.21 | 21.78 | 28.30 | 35.28 | 40.99 | 36.69 | 37.05 | 38.22 | 40.99 | 52.62 | 49.00 | 34.64 | 22.56 | 14.89 | 17.92 | 25.45 | 88.76 | 474.25 | 564.73 |
December 31, 2023 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $113,694K ÷ $16,567K
= 6.86
The interest coverage ratio for Advanced Energy Industries Inc. for the quarters Q3 2023, Q2 2023, and Q1 2023 are 66.63, 83.20, and 90.78, respectively. This indicates that the company's ability to cover its interest expenses with its operating income improved over the quarters in 2023. However, the interest coverage ratios for Q4 2023, and all quarters in 2022 are not available, making it difficult to assess the trend over a longer period.
A higher interest coverage ratio is favorable as it suggests that the company is more capable of meeting its interest obligations from its operating earnings. It indicates financial stability and reduces the risk of default. Advanced Energy Industries Inc.'s increasing interest coverage ratio in 2023 reflects an improved capacity to service its interest payments, signaling a positive financial performance during this period.
Peer comparison
Dec 31, 2023