AGCO Corporation (AGCO)
Interest coverage
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | -122,100 | 539,800 | 848,600 | 1,586,700 | 1,700,400 | 1,773,100 | 1,681,600 | 1,448,700 | 1,265,400 | 1,063,600 | 983,400 | 1,010,200 | 1,001,400 | 915,400 | 887,500 | 694,500 | 599,700 | 371,900 | 253,800 | 356,100 |
| Interest expense (ttm) | US$ in thousands | 93,000 | 72,900 | 44,500 | 20,400 | 19,000 | 16,200 | 13,000 | 13,100 | 13,000 | 27,200 | 26,100 | 22,400 | 25,400 | 8,700 | 11,100 | 15,000 | 11,700 | 38,000 | 34,600 | 28,800 |
| Interest coverage | -1.31 | 7.40 | 19.07 | 77.78 | 89.49 | 109.45 | 129.35 | 110.59 | 97.34 | 39.10 | 37.68 | 45.10 | 39.43 | 105.22 | 79.95 | 46.30 | 51.26 | 9.79 | 7.34 | 12.36 |
December 31, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $-122,100K ÷ $93,000K
= -1.31
AGCO Corporation's interest coverage ratio, as reflected in the provided data, has exhibited fluctuations over the reporting periods. The interest coverage ratio measures a company's ability to meet its interest obligations with its earnings before interest and taxes (EBIT). A higher ratio indicates that the company is more capable of servicing its debt.
Looking at the data, we observe that the interest coverage ratio for AGCO Corporation experienced significant variability. From March 31, 2020, to September 30, 2021, the company's interest coverage increased steadily, reaching levels above 100, indicating a strong ability to cover interest expenses. However, in the subsequent quarters, the ratio declined notably, dropping to a low of -1.31 on December 31, 2024, which suggests that the company's EBIT may not be sufficient to cover its interest payments during that particular period.
This downward trend in the interest coverage ratio from late 2021 to the end of 2024 may raise concerns about the company's financial health and its ability to manage its debt obligations effectively. It is essential for stakeholders to closely monitor this ratio in future periods to assess AGCO Corporation's ongoing ability to meet its interest expenses and maintain its financial stability.
Peer comparison
Dec 31, 2024