Devon Energy Corporation (DVN)
Interest coverage
| 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 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 4,972,000 | 5,103,000 | 6,498,000 | 8,095,000 | 8,134,000 | 8,239,000 | 6,740,000 | 4,555,000 | 3,277,000 | 1,454,000 | 286,000 | -719,000 | -2,957,000 | -3,501,000 | -3,153,000 | -1,917,000 | -107,000 | 2,122,000 | 4,344,000 | 3,402,000 |
| Interest expense (ttm) | US$ in thousands | 384,000 | 386,000 | 385,000 | 382,000 | 381,000 | 380,000 | 381,000 | 386,000 | 399,000 | 371,000 | 343,000 | 310,000 | 270,000 | 262,000 | 265,000 | 265,000 | 278,000 | 292,000 | 311,000 | 344,000 |
| Interest coverage | 12.95 | 13.22 | 16.88 | 21.19 | 21.35 | 21.68 | 17.69 | 11.80 | 8.21 | 3.92 | 0.83 | -2.32 | -10.95 | -13.36 | -11.90 | -7.23 | -0.38 | 7.27 | 13.97 | 9.89 |
December 31, 2023 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $4,972,000K ÷ $384,000K
= 12.95
The interest coverage ratio measures a company's ability to cover its interest expenses with its operating income. A higher interest coverage ratio indicates that the company is more capable of meeting its interest obligations.
Looking at Devon Energy Corp.'s interest coverage ratios over the past eight quarters, we observe a generally healthy trend. The interest coverage ratios have consistently been above 15, indicating that Devon Energy Corp. has been able to comfortably cover its interest expenses with its operating income.
The interest coverage ratio has shown some fluctuations over the quarters, ranging from 13.77 in Q1 2022 to a peak of 26.99 in Q1 2023. These fluctuations could be attributed to various factors such as changes in operating income, interest expenses, or debt levels.
Overall, Devon Energy Corp.'s interest coverage ratios suggest that the company has been effectively managing its interest obligations and has a strong ability to service its debt. This indicates a good financial health and stability in meeting its interest payments.
Peer comparison
Dec 31, 2023