Cisco Systems Inc (CSCO)
Interest coverage
| Jul 27, 2024 | Apr 27, 2024 | Jan 27, 2024 | Oct 28, 2023 | Jul 29, 2023 | Apr 29, 2023 | Jan 28, 2023 | Oct 29, 2022 | Jul 30, 2022 | Apr 30, 2022 | Jan 29, 2022 | Oct 30, 2021 | Jul 31, 2021 | May 1, 2021 | Jan 23, 2021 | Oct 24, 2020 | Jul 25, 2020 | Apr 25, 2020 | Jan 25, 2020 | Oct 26, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 13,044,000 | 15,008,000 | 16,482,000 | 16,723,000 | 15,745,000 | 14,672,000 | 14,497,000 | 14,666,000 | 14,837,000 | 15,161,000 | 14,972,000 | 14,649,000 | 13,696,000 | 13,288,000 | 13,160,000 | 13,484,000 | 14,555,000 | 15,038,000 | 15,290,000 | 15,164,000 |
| Interest expense (ttm) | US$ in thousands | 1,006,000 | 699,000 | 451,000 | 438,000 | 427,000 | 409,000 | 390,000 | 371,000 | 360,000 | 365,000 | 386,000 | 411,000 | 434,000 | 455,000 | 474,000 | 519,000 | 585,000 | 670,000 | 751,000 | 816,000 |
| Interest coverage | 12.97 | 21.47 | 36.55 | 38.18 | 36.87 | 35.87 | 37.17 | 39.53 | 41.21 | 41.54 | 38.79 | 35.64 | 31.56 | 29.20 | 27.76 | 25.98 | 24.88 | 22.44 | 20.36 | 18.58 |
July 27, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $13,044,000K ÷ $1,006,000K
= 12.97
The interest coverage ratio for Cisco Systems Inc has shown a generally positive trend over the past several quarters, indicating the company's ability to comfortably cover its interest expenses with its earnings. The ratio has consistently remained above 1, indicating that the company's operating income is more than sufficient to cover its interest obligations.
The increasing trend in the interest coverage ratio from 18.58 in October 2019 to 41.54 in April 2022 is particularly noteworthy, reflecting the company's improving financial health and strong profitability. Although there was a slight dip in the ratio in the most recent quarter (July 2024), it still remains at a healthy level of 12.97.
Overall, the consistently high interest coverage ratios demonstrate Cisco Systems Inc's strong financial position and ability to manage its debt obligations effectively. Investors and stakeholders can take confidence in the company's financial stability and ability to meet its interest payments in the foreseeable future.
Peer comparison
Jul 27, 2024