Estee Lauder Companies Inc (EL)

Interest coverage

		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	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
Earnings before interest and tax (EBIT) (ttm)	US$ in thousands	970,000	1,198,000	964,000	946,000	1,509,000	1,593,000	2,034,000	2,896,000	3,170,000	3,325,000	3,203,000	2,848,000	2,618,000	1,825,000	1,329,000	1,111,000	1,195,000	1,984,000	2,621,000	2,555,000
Interest expense (ttm)	US$ in thousands	378,000	386,000	350,000	304,000	255,000	198,000	181,000	171,000	167,000	167,000	169,000	170,000	173,000	180,000	179,000	174,000	161,000	144,000	134,000	131,000
Interest coverage		2.57	3.10	2.75	3.11	5.92	8.05	11.24	16.94	18.98	19.91	18.95	16.75	15.13	10.14	7.42	6.39	7.42	13.78	19.56	19.50

June 30, 2024 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $970,000K ÷ $378,000K
= 2.57

Estee Lauder Companies Inc's interest coverage ratio has exhibited fluctuations over the past few quarters. The trend indicates that the company's ability to cover its interest expenses with its earnings has varied.

The interest coverage ratio has ranged from a low of 2.57 to a high of 19.91, with the highest ratios observed in recent quarters. This increasing trend suggests that Estee Lauder Companies Inc has been able to generate sufficient earnings to cover its interest expenses comfortably.

The company's interest coverage ratio of over 1 indicates that it is earning more than enough to cover its interest obligations. A higher interest coverage ratio is generally a positive sign, indicating a lower risk of defaulting on its debt payments.

It is important for investors and stakeholders to monitor the interest coverage ratio over time to assess the company's ability to meet its debt obligations and to evaluate its financial health and stability.