Booking Holdings Inc (BKNG)
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 | 5,835,000 | 6,571,000 | 6,051,000 | 5,378,000 | 5,102,000 | 4,605,000 | 4,037,000 | 2,981,000 | 2,496,000 | 1,495,000 | -205,000 | -633,000 | -631,000 | 694,000 | 2,749,000 | 4,480,000 | 5,345,000 | 5,316,000 | 5,193,000 | 5,167,000 |
| Interest expense (ttm) | US$ in thousands | 897,000 | 834,000 | 682,000 | 517,000 | 391,000 | 321,000 | 299,000 | 304,000 | 334,000 | 357,000 | 375,000 | 390,000 | 356,000 | 320,000 | 292,000 | 264,000 | 266,000 | 270,000 | 268,000 | 265,000 |
| Interest coverage | 6.51 | 7.88 | 8.87 | 10.40 | 13.05 | 14.35 | 13.50 | 9.81 | 7.47 | 4.19 | -0.55 | -1.62 | -1.77 | 2.17 | 9.41 | 16.97 | 20.09 | 19.69 | 19.38 | 19.50 |
December 31, 2023 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $5,835,000K ÷ $897,000K
= 6.51
Booking Holdings Inc's interest coverage ratio has shown a declining trend over the past year. The interest coverage ratio measures the company's ability to meet its interest payments on outstanding debt using its operating income.
In Q4 2022, the interest coverage ratio was at the highest level of 12.54, indicating that the company generated operating income more than 12 times the amount needed to cover its interest expenses. However, since then, the ratio has been decreasing steadily, reaching 6.51 in Q4 2023.
A higher interest coverage ratio is generally considered favorable as it suggests that the company is more capable of servicing its debt obligations. The decreasing trend in Booking Holdings Inc's interest coverage ratio may raise concerns about its ability to cover interest expenses in the future, especially if this trend continues.
It is important for investors and stakeholders to closely monitor Booking Holdings Inc's interest coverage ratio to assess the company's financial health and ability to manage its debt obligations effectively.
Peer comparison
Dec 31, 2023