Dana Inc (DAN)
Interest coverage
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 241,000 | 332,000 | 97,000 | 353,000 | 177,000 |
| Interest expense | US$ in thousands | 161,000 | 154,000 | 128,000 | 131,000 | 138,000 |
| Interest coverage | 1.50 | 2.16 | 0.76 | 2.69 | 1.28 |
December 31, 2024 calculation
Interest coverage = EBIT ÷ Interest expense
= $241,000K ÷ $161,000K
= 1.50
The interest coverage ratio of Dana Inc has fluctuated over the years based on the provided data. In December 2020, the interest coverage ratio was 1.28, indicating that the company's operating income was just sufficient to cover its interest expenses. By December 2021, the ratio improved significantly to 2.69, which suggests a stronger ability to meet interest obligations from operating earnings. However, there was a notable decline in December 2022, with the interest coverage ratio dropping to 0.76, indicating a potential strain on the company's ability to cover interest payments with its operating income.
In December 2023, there was an improvement in the interest coverage ratio, which rose to 2.16, signaling a better capacity to handle interest expenses. However, by December 2024, the ratio decreased to 1.50, although still above 1, meaning the company was generating enough operating income to cover its interest payments but with less cushion compared to previous years.
Overall, Dana Inc's interest coverage ratio has exhibited variability, with some years showing stronger ability to cover interest costs than others. It will be important for the company to closely monitor this ratio to ensure it remains at a healthy level to meet its financial obligations effectively.
Peer comparison
Dec 31, 2024