Edison International (EIX)
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 | 3,432,000 | 3,127,000 | 1,831,000 | 1,714,000 | 1,468,000 |
| Interest expense | US$ in thousands | 1,869,000 | 1,612,000 | 1,169,000 | 925,000 | 902,000 |
| Interest coverage | 1.84 | 1.94 | 1.57 | 1.85 | 1.63 |
December 31, 2024 calculation
Interest coverage = EBIT ÷ Interest expense
= $3,432,000K ÷ $1,869,000K
= 1.84
Interest coverage is a financial ratio that measures a company's ability to pay its interest expenses on outstanding debt. In the case of Edison International, the interest coverage ratio has shown some fluctuation over the years.
As of December 31, 2020, the interest coverage ratio was at 1.63, indicating that the company's earnings before interest and taxes (EBIT) were able to cover its interest expenses 1.63 times. Subsequently, the ratio increased to 1.85 by December 31, 2021, suggesting a slight improvement in the company's ability to meet its interest obligations.
However, the ratio decreased to 1.57 by December 31, 2022, which could be a cause for concern as it indicates a decline in the company's ability to cover its interest payments. The ratio then improved to 1.94 by December 31, 2023, showing a positive trend in the company's financial health.
By December 31, 2024, the interest coverage ratio was at 1.84, indicating that the company's earnings were able to cover its interest expenses 1.84 times. Overall, while there have been fluctuations in the interest coverage ratio of Edison International, it is essential for investors and creditors to monitor these trends to assess the company's ability to meet its debt obligations in the long term.
Peer comparison
Dec 31, 2024