Booking Holdings Inc (BKNG)
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 | 5,835,000 | 5,102,000 | 2,496,000 | -631,000 | 5,345,000 |
| Interest expense | US$ in thousands | 897,000 | 391,000 | 334,000 | 356,000 | 266,000 |
| Interest coverage | 6.51 | 13.05 | 7.47 | -1.77 | 20.09 |
December 31, 2023 calculation
Interest coverage = EBIT ÷ Interest expense
= $5,835,000K ÷ $897,000K
= 6.51
Booking Holdings Inc's interest coverage has fluctuated over the past five years, ranging from a low of 1.92 in 2020 to a high of 46.89 in 2019. The interest coverage ratio indicates the company's ability to meet its interest obligations from its operating profits.
A higher interest coverage ratio, such as the values in 2019 and 2022, suggests that Booking Holdings Inc is comfortably able to cover its interest expenses with its operating earnings. This signifies a lower financial risk and indicates a healthy financial position.
On the other hand, the lower interest coverage ratios in 2020 and 2023 indicate that the company's ability to cover its interest expenses from its operating profits may have been strained during those years. This could potentially raise concerns about the company's financial health and its ability to service debt efficiently.
Overall, while the fluctuating trend in interest coverage ratios may indicate some variability in the company's financial performance, it is essential for stakeholders to monitor these ratios closely to assess Booking Holdings Inc's financial stability and ability to manage its debt obligations effectively.
Peer comparison
Dec 31, 2023