Cintas Corporation (CTAS)
Interest coverage
| May 31, 2024 | Feb 29, 2024 | Nov 30, 2023 | Aug 31, 2023 | May 31, 2023 | Feb 28, 2023 | Nov 30, 2022 | Aug 31, 2022 | May 31, 2022 | Feb 28, 2022 | Nov 30, 2021 | Aug 31, 2021 | May 31, 2021 | Feb 28, 2021 | Nov 30, 2020 | Aug 31, 2020 | May 31, 2020 | Feb 29, 2020 | Nov 30, 2019 | Aug 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 2,070,754 | 1,994,802 | 1,920,257 | 1,865,083 | 1,804,380 | 1,737,248 | 1,697,724 | 1,633,730 | 1,587,612 | 1,539,646 | 1,458,540 | 1,430,346 | 1,385,959 | 1,237,045 | 1,225,489 | 1,206,823 | 1,163,361 | 1,270,361 | 1,236,098 | 1,247,097 |
| Interest expense (ttm) | US$ in thousands | 100,740 | 102,437 | 105,726 | 108,056 | 111,232 | 108,517 | 101,728 | 94,710 | 88,844 | 90,337 | 92,859 | 95,514 | 98,210 | 99,611 | 101,002 | 102,622 | 105,393 | 105,223 | 106,050 | 104,753 |
| Interest coverage | 20.56 | 19.47 | 18.16 | 17.26 | 16.22 | 16.01 | 16.69 | 17.25 | 17.87 | 17.04 | 15.71 | 14.98 | 14.11 | 12.42 | 12.13 | 11.76 | 11.04 | 12.07 | 11.66 | 11.91 |
May 31, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $2,070,754K ÷ $100,740K
= 20.56
The interest coverage ratio measures a company's ability to meet its interest payments on outstanding debt. A higher interest coverage ratio indicates that a company is more capable of servicing its debt obligations.
Looking at the historical trend of Cintas Corporation's interest coverage ratio from November 2019 to May 2024, there is a general uptrend in the ratio, suggesting an improvement in the company's ability to cover its interest expenses over time. The ratio has consistently been above 10, indicating a strong ability to meet interest payments.
The interest coverage ratio peaked at 20.56 in May 2024, showing a significant improvement in the company's ability to cover its interest expenses compared to previous periods. This indicates that Cintas Corporation has ample earnings to cover its interest payments comfortably.
Overall, the upward trend in Cintas Corporation's interest coverage ratio over the analyzed period is a positive indicator of the company's financial health and ability to manage its debt obligations effectively.
Peer comparison
May 31, 2024