CorVel Corp (CRVL)
Interest coverage
| Mar 31, 2024 | Mar 31, 2023 | Mar 31, 2022 | Mar 31, 2021 | Mar 31, 2020 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 95,187 | 84,646 | 84,610 | 59,252 | 60,711 |
| Interest expense | US$ in thousands | 86 | 92 | 98 | 77 | 0 |
| Interest coverage | 1,106.83 | 920.07 | 863.37 | 769.51 | — |
March 31, 2024 calculation
Interest coverage = EBIT ÷ Interest expense
= $95,187K ÷ $86K
= 1,106.83
To analyze the interest coverage of CorVel Corp based on the data provided, we observe a consistent improvement in the company's ability to cover its interest expenses over the years. The interest coverage ratio has exhibited an upward trend from 769.51 in March 2021 to 1,106.83 in March 2024. This indicates that the company's operating profits have been more than sufficient to cover its interest obligations during the period under review. The significant increase in the interest coverage ratio reflects a strong financial position and suggests that CorVel Corp has a lower risk of defaulting on its debt payments. This positive trend may be indicative of effective cost management, improving profitability, or lower interest expenses. Overall, the consistent increase in the interest coverage ratio portrays a financially stable and healthy position for CorVel Corp.