BWX Technologies Inc (BWXT)
Interest coverage
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 380,607 | 367,964 | 350,358 | 431,054 | 392,660 |
| Interest expense | US$ in thousands | 65,700 | 47,036 | 36,410 | 35,758 | 31,014 |
| Interest coverage | 5.79 | 7.82 | 9.62 | 12.05 | 12.66 |
December 31, 2024 calculation
Interest coverage = EBIT ÷ Interest expense
= $380,607K ÷ $65,700K
= 5.79
The interest coverage ratio for BWX Technologies Inc has shown a declining trend over the past five years. As of December 31, 2020, the interest coverage ratio stood at 12.66, indicating that the company's operating income was more than sufficient to cover its interest expenses. However, this ratio decreased to 5.79 by December 31, 2024, suggesting a diminishing ability to cover interest payments from operating profits.
The gradual decline in the interest coverage ratio could imply that BWX Technologies Inc may be facing challenges in generating enough operating income to meet its interest obligations. Investors and creditors typically monitor this ratio closely as a lower interest coverage ratio may signal increased financial risk and a potential difficulty in servicing debt payments.
It is essential for BWX Technologies Inc to closely monitor and address the declining trend in its interest coverage ratio to ensure sustainable financial health and to avoid potential liquidity issues in the future.
Peer comparison
Dec 31, 2024