Cal-Maine Foods Inc (CALM)
Interest coverage
| Jun 1, 2024 | Mar 2, 2024 | Dec 2, 2023 | Sep 2, 2023 | Jun 3, 2023 | Feb 25, 2023 | Nov 26, 2022 | Aug 27, 2022 | May 28, 2022 | Feb 26, 2022 | Nov 27, 2021 | Aug 28, 2021 | May 29, 2021 | Feb 27, 2021 | Nov 28, 2020 | Aug 29, 2020 | May 30, 2020 | Feb 29, 2020 | Nov 30, 2019 | Aug 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 312,452 | 306,489 | 551,485 | 797,119 | 967,726 | 977,200 | 608,987 | 347,054 | 143,537 | -15,188 | -55,251 | -38,707 | -26,263 | 62,855 | 68,560 | 37,516 | 1,269 | -105,243 | -72,265 | -30,366 |
| Interest expense (ttm) | US$ in thousands | 276 | 426 | 34,711 | 36,507 | 37,268 | 37,501 | 3,222 | 1,299 | 403 | 206 | 209 | 211 | 213 | 492 | 493 | 495 | 498 | 1,908 | 3,884 | 5,561 |
| Interest coverage | 1,132.07 | 719.46 | 15.89 | 21.83 | 25.97 | 26.06 | 189.01 | 267.17 | 356.17 | -73.73 | -264.36 | -183.45 | -123.30 | 127.75 | 139.07 | 75.79 | 2.55 | -55.16 | -18.61 | -5.46 |
June 1, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $312,452K ÷ $276K
= 1,132.07
The interest coverage ratio of Cal-Maine Foods Inc has exhibited significant fluctuations over the past several quarters, ranging from a high of 1,132.07 to a low of -264.36 and -73.73. Although the company demonstrated strong interest coverage in some periods, notably exceeding 100 in many instances, there were also quarters where the ratio dropped to negative values, indicating a potential inability to meet interest obligations with operating earnings alone.
This volatility in the interest coverage ratio suggests that Cal-Maine Foods Inc may have experienced fluctuations in its profitability and/or interest expenses over the periods in question. A consistently high interest coverage ratio typically indicates a firm's strong capacity to service its debt, while a low or negative ratio indicates potential financial distress and an increased risk of default on debt payments.
It is important for investors and stakeholders to closely monitor Cal-Maine Foods Inc's interest coverage ratio over time to assess the company's ability to handle its interest payments and manage its debt obligations effectively. Additionally, analyzing the factors driving the fluctuations in the interest coverage ratio can provide valuable insights into the company's financial health and performance.