Evergy Inc. Common Stock (EVRG)
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 | 1,272,700 | 1,204,200 | 1,369,700 | 1,104,400 | 1,140,900 |
| Interest expense | US$ in thousands | 525,800 | 404,000 | 372,600 | 383,900 | 374,000 |
| Interest coverage | 2.42 | 2.98 | 3.68 | 2.88 | 3.05 |
December 31, 2023 calculation
Interest coverage = EBIT ÷ Interest expense
= $1,272,700K ÷ $525,800K
= 2.42
Evergy Inc's interest coverage ratio has shown some fluctuations over the past five years. The ratio was 2.45 in 2023, down from 3.24 in 2022, indicating a decrease in the company's ability to cover its interest expenses from its operating income. This decline may raise concerns about Evergy's ability to meet its interest obligations.
In 2021, the interest coverage ratio was 3.66, showing a strong ability to cover interest expenses. The ratio then decreased in 2020 to 3.00 before slightly improving to 3.20 in 2019. Overall, the trend in Evergy's interest coverage ratio has been somewhat inconsistent, with fluctuations observed in recent years.
It is essential for investors and creditors to closely monitor Evergy's interest coverage ratio to assess the company's financial health and its ability to handle its debt obligations effectively. Further analysis and consideration of the company's overall financial position and market conditions are recommended to gauge the sustainability of Evergy's interest coverage ratio in the future.
Peer comparison
Dec 31, 2023