Catalyst Pharmaceuticals Inc (CPRX)

Interest coverage

		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	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Earnings before interest and tax (EBIT) (ttm)	US$ in thousands	86,812	75,921	138,211	120,081	101,838	83,779	72,681	59,950	52,385	48,261	45,961	40,405	41,304	40,693	42,834	43,511	31,823	8,973	-13,055	-30,350
Interest expense (ttm)	US$ in thousands	0	1,118	2,023	2,347	4,144	1,322	417	93	0	336	336	336	672	735	1,128	1,578	1,585	1,530	1,481	1,402
Interest coverage		—	67.91	68.32	51.16	24.57	63.37	174.29	644.62	—	143.63	136.79	120.25	61.46	55.36	37.97	27.57	20.08	5.86	-8.81	-21.65

December 31, 2023 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $86,812K ÷ $0K
= —

Based on the data provided, Catalyst Pharmaceuticals Inc's interest coverage ratio has shown variability over the past few quarters. The interest coverage ratio measures the company's ability to meet its interest obligations with its operating earnings. A higher interest coverage ratio indicates a better capacity to cover interest expenses.

In Dec 2018, the interest coverage ratio was negative, implying that the company's operating earnings were not sufficient to cover its interest expenses. However, since then, there has been a general upward trend in the interest coverage ratio. Notably, the ratio saw a significant improvement in Jun 2022 and continued to rise until Sep 2023, reaching a peak of 644.62, indicating a substantial improvement in the company's ability to cover interest expenses.

The strong interest coverage ratio in recent quarters suggests that Catalyst Pharmaceuticals Inc has been generating ample operating earnings to comfortably cover its interest payments. This trend indicates improved financial health and reduced financial risk associated with meeting interest obligations. However, it is essential for the company to sustain this positive trend in order to maintain its financial stability and support future growth prospects.