Avery Dennison Corp (AVY)
Interest coverage
| 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 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 813,700 | 774,100 | 852,200 | 988,800 | 1,083,400 | 1,155,300 | 1,102,900 | 1,064,400 | 1,058,900 | 1,065,300 | 1,036,400 | 888,100 | 803,600 | 716,100 | 701,900 | 787,800 | 322,700 | 244,100 | 227,800 | 173,800 |
| Interest expense (ttm) | US$ in thousands | 119,000 | 111,800 | 102,000 | 90,900 | 84,100 | 81,600 | 78,400 | 73,600 | 70,200 | 65,800 | 63,400 | 67,400 | 70,000 | 72,200 | 75,600 | 75,100 | 75,800 | 74,300 | 70,000 | 64,800 |
| Interest coverage | 6.84 | 6.92 | 8.35 | 10.88 | 12.88 | 14.16 | 14.07 | 14.46 | 15.08 | 16.19 | 16.35 | 13.18 | 11.48 | 9.92 | 9.28 | 10.49 | 4.26 | 3.29 | 3.25 | 2.68 |
December 31, 2023 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $813,700K ÷ $119,000K
= 6.84
Avery Dennison Corp has shown a consistently strong interest coverage ratio over the past few quarters, indicating the company's ability to comfortably meet its interest obligations from its operating profits. The interest coverage ratio has been trending upwards since March 31, 2019, with the latest ratio as of December 31, 2023, standing at 6.84. This indicates that the company's operating income is 6.84 times higher than its interest expenses, reflecting a healthy financial position. The company's interest coverage ratio has generally been above 5, which is considered a good benchmark for financial health and stability. Overall, Avery Dennison Corp's interest coverage ratio suggests that it has a strong ability to service its debt and is well-positioned to meet its interest payments in the future.
Peer comparison
Dec 31, 2023