Adapthealth Corp (AHCO)
Interest coverage
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 263,732 | -597,596 | 203,499 | 284,176 | -132,157 |
| Interest expense | US$ in thousands | 124,700 | 130,299 | 109,414 | 95,195 | 41,430 |
| Interest coverage | 2.11 | -4.59 | 1.86 | 2.99 | -3.19 |
December 31, 2024 calculation
Interest coverage = EBIT ÷ Interest expense
= $263,732K ÷ $124,700K
= 2.11
Adapthealth Corp's interest coverage ratio has fluctuated significantly over the past five years. The ratio was negative in December 2020, indicating that the company's operating income was insufficient to cover its interest expenses. However, the ratio improved to 2.99 in December 2021, suggesting that the company's operating income was nearly three times its interest expenses.
In the following years, Adapthealth Corp's interest coverage ratio decreased to 1.86 in December 2022, indicating a slightly weaker ability to cover interest payments. This was followed by a significant decline to -4.59 in December 2023, signaling a substantial decrease in operating income relative to interest expenses. Nonetheless, the ratio improved to 2.11 by December 2024, reflecting a recovery in the company's ability to cover its interest obligations.
Overall, Adapthealth Corp's interest coverage ratio has shown variability, with periods of strong and weak coverage. Investors and analysts may want to monitor this ratio closely to assess the company's financial health and ability to service its debt obligations.
Peer comparison
Dec 31, 2024