Cognex Corporation (CGNX)

Interest coverage

		Dec 31, 2024	Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	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
Earnings before interest and tax (EBIT) (ttm)	US$ in thousands	115,065	96,954	96,027	122,745	130,702	172,310	181,696	181,662	246,229	248,412	295,936	323,376	315,101	317,666	326,754	228,031	170,529	129,051	75,508	133,406
Interest expense (ttm)	US$ in thousands	0	4,054	4,054	4,054	8,108	14,535	16,805	46,333	48,211	37,730	35,460	5,932	0	0	0	3,627	5,853	5,853	9,672	6,045
Interest coverage		—	23.92	23.69	30.28	16.12	11.85	10.81	3.92	5.11	6.58	8.35	54.51	—	—	—	62.87	29.14	22.05	7.81	22.07

December 31, 2024 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $115,065K ÷ $0K
= —

Cognex Corporation's interest coverage ratio has shown fluctuation over the years. The interest coverage ratio measures the company's ability to meet its interest payment obligations from its earnings.

The company's interest coverage ratio was strong in the first quarter of 2020 at 22.07, indicating that Cognex had more than enough operating income to cover its interest expenses. However, there was a significant decline in the second quarter of 2020 to 7.81, which could be a cause for concern as it suggests that the company may have had difficulty meeting its interest payments with its operating income.

Subsequently, there was a notable improvement in the interest coverage ratio in the following quarters, reaching 29.14 in the fourth quarter of 2020 and peaking at 62.87 in the first quarter of 2021. These high ratios indicate a strong ability to cover interest payments comfortably.

Although the interest coverage ratio showed stability in the following quarters, the ratio started to decline again in the third quarter of 2022, dropping to 6.58 and further declining to 3.92 in the first quarter of 2023. This downward trend continued until the second quarter of 2024 when the ratio increased to 23.69, signaling some recovery.

As of December 31, 2024, the interest coverage ratio was not available. It is crucial for investors and stakeholders to monitor Cognex Corporation's interest coverage ratio closely to ensure that the company can meet its debt obligations and manage its financial health effectively.