Domino’s Pizza Inc (DPZ)
Interest coverage
| Dec 31, 2023 | Sep 10, 2023 | Jun 18, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 11, 2022 | Jun 19, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 12, 2021 | Jun 20, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 6, 2020 | Jun 14, 2020 | Mar 22, 2020 | Dec 31, 2019 | Sep 8, 2019 | Jun 16, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 848,915 | 834,099 | 791,014 | 786,371 | 771,087 | 777,361 | 780,404 | 793,041 | 817,511 | 804,287 | 786,337 | 759,590 | 727,296 | 688,783 | 670,402 | 646,024 | 633,455 | 608,558 | 597,785 | 585,264 |
| Interest expense (ttm) | US$ in thousands | 196,475 | 197,369 | 198,010 | 197,929 | 198,254 | 198,144 | 198,230 | 199,256 | 191,806 | 185,186 | 178,268 | 172,118 | 172,166 | 165,948 | 161,095 | 155,234 | 150,818 | 148,628 | 148,852 | 151,113 |
| Interest coverage | 4.32 | 4.23 | 3.99 | 3.97 | 3.89 | 3.92 | 3.94 | 3.98 | 4.26 | 4.34 | 4.41 | 4.41 | 4.22 | 4.15 | 4.16 | 4.16 | 4.20 | 4.09 | 4.02 | 3.87 |
December 31, 2023 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $848,915K ÷ $196,475K
= 4.32
The interest coverage ratio for Dominos Pizza Inc has been relatively stable over the past eight quarters, ranging from 3.77 to 4.44. This ratio indicates the company's ability to meet its interest payments on outstanding debt with its operating income. A higher interest coverage ratio typically suggests a healthier financial position and lower risk of default.
Dominos Pizza Inc's interest coverage ratio has been consistently above 3, which is generally considered a minimum threshold for financial health. The gradual increase in the ratio from Q1 2022 to Q4 2023 indicates an improving ability to cover interest expenses with operating income, which may signal enhanced financial stability and creditworthiness.
Overall, Dominos Pizza Inc's interest coverage ratio appears to demonstrate a strong ability to manage its interest obligations with its operating income during the period under review.
Peer comparison
Dec 31, 2023