Campbell Soup Company Common Stock (CPB)
Interest coverage
| Jan 31, 2025 | Oct 31, 2024 | Jul 31, 2024 | Jul 28, 2024 | Apr 30, 2024 | Apr 28, 2024 | Jan 31, 2024 | Jan 28, 2024 | Oct 31, 2023 | Oct 29, 2023 | Jul 31, 2023 | Jul 30, 2023 | Apr 30, 2023 | Jan 31, 2023 | Jan 29, 2023 | Oct 31, 2022 | Oct 30, 2022 | Jul 31, 2022 | May 1, 2022 | Apr 30, 2022 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 849,000 | 770,000 | 655,000 | 895,000 | 1,134,000 | 1,272,000 | 1,379,000 | 1,327,000 | 1,284,000 | 1,187,000 | 1,111,000 | 1,196,000 | 1,359,000 | 1,507,000 | 1,349,000 | 1,294,000 | 1,152,000 | 936,000 | 1,134,000 | 1,215,000 |
| Interest expense (ttm) | US$ in thousands | 343,000 | 325,000 | 308,000 | 269,000 | 231,000 | 210,000 | 189,000 | 193,000 | 196,000 | 194,000 | 190,000 | 186,000 | 184,000 | 184,000 | 184,000 | 190,000 | 194,000 | 193,000 | 194,000 | 190,000 |
| Interest coverage | 2.48 | 2.37 | 2.13 | 3.33 | 4.91 | 6.06 | 7.30 | 6.88 | 6.55 | 6.12 | 5.85 | 6.43 | 7.39 | 8.19 | 7.33 | 6.81 | 5.94 | 4.85 | 5.85 | 6.39 |
January 31, 2025 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $849,000K ÷ $343,000K
= 2.48
The interest coverage ratio of Campbell Soup Company Common Stock has shown a declining trend over the past few periods. The interest coverage ratio calculates the company's ability to pay interest expenses on its outstanding debt using its operating income.
From April 2022 to January 2023, the interest coverage ratio improved steadily from 6.39 to 8.19, indicating the company's strong ability to cover its interest obligations. However, from April 2023 onwards, the ratio began to decline. By April 2024, the interest coverage ratio reached a low of 4.91, indicating a decrease in the company's ability to cover its interest expenses.
The declining trend in the interest coverage ratio suggests that Campbell Soup Company Common Stock may be facing challenges in generating sufficient operating income to cover its interest payments. This could be a concern for creditors and investors as it may indicate a higher risk of default on debt obligations. Management may need to closely monitor the company's financial performance and take necessary steps to improve the interest coverage ratio to ensure financial stability.
Peer comparison
Jan 31, 2025