CMS Energy Corporation (CMS)
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 | 1,597,000 | 1,719,000 | 1,703,000 | 1,819,000 | 1,677,000 | 1,461,000 | 1,424,000 | 1,313,000 | 1,449,000 | 1,888,000 | 1,914,000 | 1,949,000 | 1,948,000 | 1,490,000 | 1,538,000 | 1,502,000 | 1,394,000 | 1,345,000 | 1,339,000 | 1,296,000 |
| Interest expense (ttm) | US$ in thousands | 687,000 | 685,000 | 678,000 | 673,000 | 643,000 | 610,000 | 576,000 | 542,000 | 519,000 | 506,000 | 501,000 | 500,000 | 500,000 | 501,000 | 506,000 | 508,000 | 521,000 | 469,000 | 472,000 | 476,000 |
| Interest coverage | 2.32 | 2.51 | 2.51 | 2.70 | 2.61 | 2.40 | 2.47 | 2.42 | 2.79 | 3.73 | 3.82 | 3.90 | 3.90 | 2.97 | 3.04 | 2.96 | 2.68 | 2.87 | 2.84 | 2.72 |
December 31, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $1,597,000K ÷ $687,000K
= 2.32
Interest coverage ratio is a financial metric used to assess a company's ability to pay the interest expenses on its outstanding debt. It is calculated by dividing a company's earnings before interest and taxes (EBIT) by its interest expenses. A higher interest coverage ratio indicates that the company is more capable of meeting its interest obligations.
Analyzing the interest coverage ratio of CMS Energy Corporation based on the provided data, we observe fluctuations in the ratio over the periods. The interest coverage ratio ranged from a low of 2.42 on March 31, 2023, to a high of 3.90 on December 31, 2021, and March 31, 2022, indicating variations in the company's ability to cover its interest payments over time.
Overall, the interest coverage ratio of CMS Energy Corporation has shown some volatility, with occasional fluctuations above and below the 3.00 mark. It is important to closely monitor this ratio to ensure the company maintains a healthy financial position and can meet its debt obligations comfortably. Further analysis and comparison with industry benchmarks would provide more insights into the company's financial health and its ability to manage its debt effectively.
Peer comparison
Dec 31, 2024