Amedisys Inc (AMED)
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 | 125,366 | 158,580 | 196,769 | 183,925 | 174,018 | 199,292 | 178,819 | 175,189 | 180,772 | 184,202 | 203,977 | 236,341 | 258,658 | 277,545 | 283,740 | 251,665 | 226,009 | 201,347 | 184,468 | 185,218 |
| Interest expense (ttm) | US$ in thousands | 30,764 | 32,020 | 32,269 | 31,876 | 31,274 | 28,821 | 25,763 | 26,572 | 22,228 | 19,238 | 17,005 | 10,626 | 9,525 | 9,097 | 9,059 | 9,879 | 11,038 | 11,731 | 12,817 | 14,397 |
| Interest coverage | 4.08 | 4.95 | 6.10 | 5.77 | 5.56 | 6.91 | 6.94 | 6.59 | 8.13 | 9.57 | 12.00 | 22.24 | 27.16 | 30.51 | 31.32 | 25.47 | 20.48 | 17.16 | 14.39 | 12.87 |
December 31, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $125,366K ÷ $30,764K
= 4.08
The interest coverage ratio of Amedisys Inc has shown a general trend of improvement from March 31, 2020, to June 30, 2021, indicating the company's ability to meet its interest obligations using its operating income. The ratio increased steadily from 12.87 in March 2020 to a peak of 31.32 in June 2021. This indicates a strong ability to cover interest payments, providing a cushion against potential financial risk.
However, starting from September 30, 2021, the interest coverage ratio began to decline gradually, reflecting a potential weakening of the company's ability to cover interest payments. This decreasing trend continued through the following periods up to December 31, 2024, with the interest coverage ratio reaching a low of 4.08. A declining interest coverage ratio may raise concerns about the company's financial health and its ability to meet debt obligations comfortably in the future.
Overall, while Amedisys Inc's interest coverage ratio initially showed positive growth, the subsequent decline emphasizes the importance of closely monitoring the company's financial performance and debt management practices to ensure sustainability and mitigate potential financial risks.
Peer comparison
Dec 31, 2024