Dream Finders Homes Inc (DFH)

Interest coverage

		Dec 31, 2024	Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	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
Earnings before interest and tax (EBIT) (ttm)	US$ in thousands	2,301,231	1,118,821	421,395	410,218	411,144	387,870	359,660	351,454	344,204	297,941	241,184	188,288	149,260
Interest expense (ttm)	US$ in thousands	0	241,666	365,953	367,153	368,285	126,620	2,338	1,151	32	31	40	43	672
Interest coverage		—	4.63	1.15	1.12	1.12	3.06	153.83	305.35	10,756.38	9,611.00	6,029.60	4,378.79	222.11

December 31, 2024 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $2,301,231K ÷ $0K
= —

Dream Finders Homes Inc's interest coverage ratio has fluctuated significantly over the periods provided. For example, as of December 31, 2021, the interest coverage ratio was 222.11, indicating that the company's operating income was more than sufficient to cover its interest expenses by over 200 times. This high ratio implies a very low risk of default on interest payments.

However, the interest coverage ratio surged to 4,378.79 as of March 31, 2022, suggesting a substantial improvement in the company's ability to cover interest expenses. This trend continued with the ratio reaching 6,029.60 and 9,611.00 as of June 30, 2022, and September 30, 2022, respectively. The company's interest coverage remained robust at 10,756.38 as of December 31, 2022, further strengthening its financial position.

Subsequently, there was a sharp decline in the interest coverage ratio to 305.35 as of March 31, 2023, indicating a potential deterioration in the company's ability to cover interest costs efficiently. This decline continued with the ratio plummeting to 153.83 and 3.06 as of June 30, 2023, and September 30, 2023, respectively. The ratio further degraded to 1.12 as of December 31, 2023, remaining at the same level for the subsequent reporting periods up to June 30, 2024.

Overall, the significant fluctuations in Dream Finders Homes Inc's interest coverage ratio reflect varying levels of financial risk and operational efficiency over the reporting periods. The company exhibited exceptionally strong interest coverage initially but experienced a sharp decline in subsequent periods, signaling potential challenges in meeting interest obligations.