AeroVironment Inc (AVAV)
Interest coverage
| Apr 30, 2024 | Apr 30, 2023 | Apr 30, 2022 | Apr 30, 2021 | Apr 30, 2020 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 71,824 | -178,663 | -9,887 | 43,313 | 47,135 |
| Interest expense | US$ in thousands | 1,009 | 845 | 789 | 145 | 213 |
| Interest coverage | 71.18 | -211.44 | -12.53 | 298.71 | 221.29 |
April 30, 2024 calculation
Interest coverage = EBIT ÷ Interest expense
= $71,824K ÷ $1,009K
= 71.18
AeroVironment Inc's interest coverage ratio indicates the company's ability to meet its interest obligations with its operating profit. A higher interest coverage ratio is generally considered favorable as it suggests that the company is comfortably generating enough operating income to cover its interest expenses.
From the data provided:
- In April 2024, the interest coverage ratio was 71.18, showing a significant improvement from the negative levels in the previous years.
- In April 2023, the interest coverage ratio was -211.44, indicating that the company's operating profit was insufficient to cover its interest expenses.
- In April 2022, the interest coverage ratio was -12.53, still in negative territory but showing some improvement from the previous year.
- In April 2021 and April 2020, the interest coverage ratios were 298.71 and 221.29, respectively, indicating strong operating performance in those years.
Overall, AeroVironment Inc's interest coverage has shown variability over the years, with some periods of strong performance and others where the company struggled to cover its interest expenses. It is crucial for the company to continue monitoring and managing its interest coverage ratio to ensure its long-term financial stability.
Peer comparison
Apr 30, 2024