Costco Wholesale Corp (COST)

Interest coverage

		Feb 18, 2024	Nov 26, 2023	Sep 3, 2023	May 7, 2023	Feb 12, 2023	Nov 20, 2022	Aug 28, 2022	May 8, 2022	Feb 13, 2022	Nov 21, 2021	Aug 29, 2021	May 9, 2021	Feb 14, 2021	Nov 22, 2020	Aug 30, 2020	May 10, 2020	Feb 16, 2020	Nov 24, 2019	Sep 1, 2019	May 12, 2019
Earnings before interest and tax (EBIT) (ttm)	US$ in thousands	9,248,000	8,987,000	8,647,000	8,182,000	8,218,000	8,017,000	7,927,000	7,692,000	7,526,000	7,049,000	6,779,000	6,365,000	5,874,000	5,830,000	5,470,000	5,089,000	5,051,000	4,993,000	4,870,000	4,833,000
Interest expense (ttm)	US$ in thousands	171,000	164,000	160,000	152,000	151,000	153,000	158,000	162,000	167,000	171,000	171,000	170,000	167,000	161,000	160,000	154,000	152,000	152,000	150,000	153,000
Interest coverage		54.08	54.80	54.04	53.83	54.42	52.40	50.17	47.48	45.07	41.22	39.64	37.44	35.17	36.21	34.19	33.05	33.23	32.85	32.47	31.59

February 18, 2024 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $9,248,000K ÷ $171,000K
= 54.08

Costco Wholesale Corp has maintained a consistently high interest coverage ratio over the past few reporting periods, indicating strong ability to cover its interest expenses with operating income. The interest coverage ratio has ranged from a low of 31.59 to a high of 54.80 during the period under review. This demonstrates the company's robust financial health and its capacity to service its debt obligations comfortably. The upward trend in the interest coverage ratio is a positive indicator of Costco's financial stability and ability to generate sufficient earnings to meet its interest payments. Overall, Costco's interest coverage ratio suggests a healthy financial position and sound management of its debt obligations.