Concentrix Corporation (CNXC)

Interest coverage

		Feb 29, 2024	Nov 30, 2023	Aug 31, 2023	May 31, 2023	Feb 28, 2023	Nov 30, 2022	Aug 31, 2022	May 31, 2022	Feb 28, 2022	Nov 30, 2021
Earnings before interest and tax (EBIT) (ttm)	US$ in thousands	653,719	661,327	658,870	654,148	648,494	640,192	620,107	613,941	585,253	572,397
Interest expense (ttm)	US$ in thousands	249,453	201,004	158,557	129,536	95,296	70,076	45,745	30,341	24,113	23,046
Interest coverage		2.62	3.29	4.16	5.05	6.81	9.14	13.56	20.23	24.27	24.84

February 29, 2024 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $653,719K ÷ $249,453K
= 2.62

Concentrix Corporation's interest coverage has been fluctuating over the past several quarters. The company's interest coverage ratio indicates its ability to meet interest obligations on its debt using its operating income. A higher interest coverage ratio suggests a stronger ability to meet interest payments.

Looking at the trend, Concentrix's interest coverage ratio has generally been decreasing over the past few quarters, indicating a potential weakening in its ability to cover interest expenses with operating income. The ratio peaked at 24.84 in the last quarter of the fiscal year 2021 and has since been on a declining trend.

The decreasing trend could be a cause for concern as it may indicate increasing financial leverage or declining operating income relative to interest expenses. It is essential for stakeholders to monitor this ratio closely to ensure Concentrix's financial health and ability to service its debt obligations.