AeroVironment Inc (AVAV)
Interest coverage
| Apr 30, 2025 | Jan 31, 2025 | Oct 31, 2024 | Jul 31, 2024 | Apr 30, 2024 | Jan 31, 2024 | Jan 27, 2024 | Oct 31, 2023 | Oct 28, 2023 | Jul 31, 2023 | Jul 29, 2023 | Apr 30, 2023 | Jan 31, 2023 | Jan 28, 2023 | Oct 31, 2022 | Oct 29, 2022 | Jul 31, 2022 | Jul 30, 2022 | Apr 30, 2022 | Jan 31, 2022 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 26,868 | 31,423 | 47,838 | 56,018 | 59,435 | 80,058 | 90,992 | 103,025 | -87,062 | -110,220 | -130,851 | -170,722 | -21,191 | -26,891 | -34,772 | -7,919 | -7,697 | -18,143 | -21,578 | -31,588 |
| Interest expense (ttm) | US$ in thousands | 2,188 | 1,325 | 1,191 | 715 | 2,426 | 2,488 | 4,382 | 4,382 | 5,078 | 7,678 | 5,882 | 7,977 | 5,542 | 4,335 | 4,334 | 3,301 | 4,600 | 3,125 | 4,293 | 3,146 |
| Interest coverage | 12.28 | 23.72 | 40.17 | 78.35 | 24.50 | 32.18 | 20.76 | 23.51 | -17.14 | -14.36 | -22.25 | -21.40 | -3.82 | -6.20 | -8.02 | -2.40 | -1.67 | -5.81 | -5.03 | -10.04 |
April 30, 2025 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $26,868K ÷ $2,188K
= 12.28
AeroVironment Inc.'s interest coverage ratio has demonstrated significant variability over the analyzed period. Prior to early 2023, the company reported consistently negative interest coverage ratios, with values beginning at -10.04 times in January 2022 and reaching a low of -22.25 times in July 2023. These negative figures indicate that during this period, AeroVironment was not generating sufficient operating income to cover its interest expenses, reflecting financial challenges or high interest obligations relative to earnings.
However, beginning in late 2023, there is a marked positive turn. The interest coverage ratio shifts to a positive value of 23.51 times in October 2023, suggesting the company's operating income exceeded its interest expense by a substantial margin. This improvement continues into early 2024, with ratios rising to over 20 times (e.g., 20.76 in January 2024 and 32.18 in January 2024), indicating a significant enhancement in the company's ability to meet interest obligations from operating earnings.
The subsequent periods show continued strength, with ratios remaining comfortably above 20 times through mid-2024, reaching as high as 78.35 times in July 2024. Although there is some decrease thereafter, the interest coverage remains positive, at around 40.17 times in October 2024, and maintaining levels above 12 times into early 2025.
Overall, the trend illustrates a trajectory from a long-standing period of negative interest coverage—implying potential financial distress or high leverage—to a period of strong positive coverage ratios, reflecting improved operating performance and a better capacity to service debt obligations.
Peer comparison
Apr 30, 2025