EQT Corporation (EQT)
Interest coverage
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 2,323,850 | 2,574,340 | -1,281,030 | -994,824 | -1,397,620 |
| Interest expense | US$ in thousands | 219,660 | 249,655 | 289,753 | 259,268 | 199,851 |
| Interest coverage | 10.58 | 10.31 | -4.42 | -3.84 | -6.99 |
December 31, 2023 calculation
Interest coverage = EBIT ÷ Interest expense
= $2,323,850K ÷ $219,660K
= 10.58
EQT Corp's interest coverage ratio measures the company's ability to meet its interest expenses with its operating income. A higher interest coverage ratio indicates a stronger ability to cover interest payments.
From the data provided, we observe fluctuations in EQT Corp's interest coverage ratio over the past five years.
- In 2023, the interest coverage ratio stood at 11.50, indicating the company generated operating income of 11.50 times its interest expense.
- In 2022, the interest coverage ratio improved to 12.65, reflecting a further strengthening in the company's ability to cover its interest obligations.
- However, in 2021, the interest coverage ratio was negative at -3.24, indicating that EQT Corp's operating income was insufficient to cover its interest expenses during that period.
- Similarly, in 2020, the interest coverage ratio was negative at -1.50, indicating financial distress as operating income fell short of covering interest payments.
- In 2019, the interest coverage ratio improved to 3.38, showing a better ability to cover interest costs compared to the negative ratios in the preceding years.
Overall, EQT Corp's interest coverage has been volatile, with both positive and negative fluctuations in recent years. Investors and creditors should closely monitor the company's ability to generate sufficient operating income to cover its interest expenses to assess its financial health and risk profile.
Peer comparison
Dec 31, 2023