Avis Budget Group Inc (CAR)
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 | 2,207,000 | 2,555,000 | 3,128,000 | 3,614,000 | 3,894,000 | 3,905,000 | 3,473,000 | 2,867,000 | 1,928,000 | 1,266,000 | 406,000 | -697,000 | -725,000 | -605,000 | -345,000 | 342,000 | 465,000 | 464,000 | 486,000 | 444,000 |
| Interest expense (ttm) | US$ in thousands | 296,000 | 290,000 | 274,000 | 270,000 | 250,000 | 232,000 | 215,000 | 210,000 | 218,000 | 235,000 | 252,000 | 244,000 | 231,000 | 202,000 | 187,000 | 184,000 | 178,000 | 188,000 | 183,000 | 184,000 |
| Interest coverage | 7.46 | 8.81 | 11.42 | 13.39 | 15.58 | 16.83 | 16.15 | 13.65 | 8.84 | 5.39 | 1.61 | -2.86 | -3.14 | -3.00 | -1.84 | 1.86 | 2.61 | 2.47 | 2.66 | 2.41 |
December 31, 2023 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $2,207,000K ÷ $296,000K
= 7.46
Avis Budget Group Inc's interest coverage has shown a declining trend over the quarters, from 6.61 in Q4 2022 to 2.88 in Q4 2023. The company's ability to cover its interest expenses has weakened in recent quarters, indicating potential challenges in meeting its interest obligations from operating income. It is worth noting that the interest coverage ratio has been consistently above 1 in all quarters, indicating that the company is generating enough operating income to cover its interest expenses. However, the decreasing trend warrants attention, as lower interest coverage may signal increased financial risk and potential difficulties in servicing debt obligations in the future. Management should closely monitor this metric and take necessary actions to improve the company's debt-servicing capabilities.
Peer comparison
Dec 31, 2023