Danaher Corporation (DHR)

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	—	5,202,000	7,580,000	7,839,000	4,815,000
Interest expense	US$ in thousands	278,000	286,000	211,000	238,000	275,000
Interest coverage		0.00	18.19	35.92	32.94	17.51

December 31, 2024 calculation

Interest coverage = EBIT ÷ Interest expense
= $—K ÷ $278,000K
= 0.00

Interest coverage is a financial ratio that measures a company's ability to meet its interest payments on outstanding debt. Danaher Corporation's interest coverage has shown strong performance over the past years.

As of December 31, 2020, the interest coverage ratio was 17.51, indicating that the company generated operating income 17.51 times more than the interest expense for that period. This demonstrated a solid ability to cover its interest obligations.

By December 31, 2021, the interest coverage ratio improved significantly to 32.94, indicating an even stronger ability to cover interest payments from operating income. This trend continued to strengthen in the subsequent years, with ratios of 35.92 by December 31, 2022 and 18.19 by December 31, 2023.

However, there is a notable anomaly in the data provided for December 31, 2024, where the interest coverage ratio is reported as 0.00. This could suggest that the company did not generate enough operating income to cover its interest expenses for that period. It is important to investigate the reasons behind this sudden drop in interest coverage to assess the potential risks to Danaher Corporation's financial health.

Overall, Danaher Corporation's interest coverage ratio has demonstrated consistent strength and improvement over the years, except for the anomaly in 2024. This ratio is a key indicator of the company's ability to manage its debt obligations and generate sufficient income to meet interest payments.