ConAgra Foods Inc (CAG)

Interest coverage

		May 26, 2024	Feb 25, 2024	Nov 26, 2023	Aug 27, 2023	May 28, 2023	Feb 26, 2023	Nov 27, 2022	Aug 28, 2022	May 29, 2022	Feb 27, 2022	Nov 28, 2021	Aug 29, 2021	May 30, 2021	Feb 28, 2021	Nov 29, 2020	Aug 30, 2020	May 31, 2020	Feb 23, 2020	Nov 24, 2019	Aug 25, 2019
Earnings before interest and tax (EBIT) (ttm)	US$ in thousands	1,175,000	1,812,400	1,814,900	1,927,700	1,464,200	1,566,400	1,409,600	1,221,900	1,587,600	1,686,400	1,807,700	1,981,800	2,141,000	2,272,000	2,166,200	2,039,500	1,815,600	1,707,300	1,748,500	1,666,000
Interest expense (ttm)	US$ in thousands	448,200	443,700	441,100	427,900	418,800	407,900	397,700	392,000	388,500	391,700	397,600	410,500	430,500	452,100	472,300	488,200	497,000	501,200	512,800	471,900
Interest coverage		2.62	4.08	4.11	4.51	3.50	3.84	3.54	3.12	4.09	4.31	4.55	4.83	4.97	5.03	4.59	4.18	3.65	3.41	3.41	3.53

May 26, 2024 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $1,175,000K ÷ $448,200K
= 2.62

ConAgra Foods Inc's interest coverage has exhibited fluctuations over the past several quarters. The interest coverage ratio measures the company's ability to meet its interest obligations from its operating income. A higher ratio indicates a stronger ability to cover interest expenses.

From November 2019 to May 2020, the interest coverage ratio declined from 3.53 to 3.41 but then increased steadily for the next few quarters, reaching a peak of 5.03 in May 2021. However, the ratio slightly decreased in subsequent quarters but remained above 3.50 until May 2024.

Overall, ConAgra Foods Inc's interest coverage has generally been healthy, consistently above 3.00. This indicates that the company has been able to comfortably cover its interest expenses with its operating income, demonstrating a sound financial position in terms of debt repayment capacity.