EQT Corporation (EQT)

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	2,323,846	3,924,598	4,805,783	6,109,924	2,574,344	2,716,634	-742,060	-3,214,960	-1,281,033	-3,614,859	-1,809,422	-902,794	-994,824	-2,628,268	-2,270,687	-1,755,061	-1,397,620	-577,958	-233,770	-468,700
Interest expense (ttm)	US$ in thousands	219,660	202,486	202,197	228,299	249,655	265,542	280,913	287,182	289,753	280,590	274,235	267,367	259,268	241,980	220,535	205,652	199,851	212,532	221,003	227,620
Interest coverage		10.58	19.38	23.77	26.76	10.31	10.23	-2.64	-11.19	-4.42	-12.88	-6.60	-3.38	-3.84	-10.86	-10.30	-8.53	-6.99	-2.72	-1.06	-2.06

December 31, 2023 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $2,323,846K ÷ $219,660K
= 10.58

Interest coverage ratio is a key financial metric that indicates a company's ability to meet its interest obligations with its operating income. In the case of EQT Corp, the interest coverage ratio has shown significant fluctuations over the past eight quarters.

In Q4 2023, the interest coverage ratio stood at 11.50, which means that EQT Corp generated operating income 11.50 times greater than its interest expenses during that period. This suggests a relatively healthy ability to cover interest costs. The ratio improved further in Q3 2023 to 20.30, indicating a strengthening financial position in terms of meeting interest payments.

Q2 and Q1 2023 continued this positive trend with interest coverage ratios of 24.89 and 28.34 respectively. These exceptionally high ratios indicate a robust ability to pay interest charges and suggest a strong financial position.

However, looking back at Q2 2022 and Q1 2022, EQT Corp faced challenges as reflected in their negative interest coverage ratios. A negative interest coverage ratio, such as the ones recorded in these quarters (-0.28 and -8.95), indicates that the company's operating income was insufficient to cover interest expenses during those periods. This could raise concerns regarding the company's ability to service its debt obligations.

Overall, EQT Corp's interest coverage ratio has displayed volatility over the past eight quarters, with both strong and weak performances. Investors and stakeholders should monitor this ratio closely to assess the company's financial health and ability to manage its debt obligations effectively.