Ametek Inc (AME)

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	1,688,210	1,511,880	1,303,550	1,168,370	1,158,230
Interest expense	US$ in thousands	81,795	83,186	80,381	86,062	88,481
Interest coverage		20.64	18.17	16.22	13.58	13.09

December 31, 2023 calculation

Interest coverage = EBIT ÷ Interest expense
= $1,688,210K ÷ $81,795K
= 20.64

Ametek Inc's interest coverage has shown steady improvement over the past five years, with the ratio increasing from 13.31 in 2019 to 20.87 in 2023. This indicates the company's ability to comfortably meet its interest obligations with its operating income. The upward trend in the interest coverage ratio suggests that Ametek Inc is becoming more financially stable and has a stronger ability to service its debt. The company's interest coverage ratio exceeding 1 indicates that it is generating sufficient operating income to cover its interest expense, providing a buffer against potential financial risks. Overall, the increasing trend in Ametek Inc's interest coverage ratio reflects positively on the company's financial health and ability to manage its debt obligations effectively.