The Gap, Inc. (GAP)
Interest coverage
| Aug 3, 2024 | May 4, 2024 | Feb 3, 2024 | Oct 28, 2023 | Jul 29, 2023 | Apr 29, 2023 | Jan 28, 2023 | Oct 29, 2022 | Jul 30, 2022 | Apr 30, 2022 | Jan 29, 2022 | Oct 30, 2021 | Jul 31, 2021 | May 1, 2021 | Jan 30, 2021 | Oct 31, 2020 | Aug 1, 2020 | May 2, 2020 | Feb 1, 2020 | Nov 2, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 1,069,000 | 872,000 | 646,000 | 386,000 | 298,000 | 148,000 | -51,000 | -23,000 | -384,000 | 53,000 | 490,000 | 617,000 | 964,000 | 571,000 | -910,000 | -1,283,000 | -1,231,000 | -958,000 | 604,000 | 1,224,000 |
| Interest expense (ttm) | US$ in thousands | 97,000 | 88,000 | 90,000 | 91,000 | 85,000 | 91,000 | 88,000 | 81,000 | 103,000 | 133,000 | 167,000 | 209,000 | 220,000 | 227,000 | 192,000 | 150,000 | 114,000 | 75,000 | 76,000 | 77,000 |
| Interest coverage | 11.02 | 9.91 | 7.18 | 4.24 | 3.51 | 1.63 | -0.58 | -0.28 | -3.73 | 0.40 | 2.93 | 2.95 | 4.38 | 2.52 | -4.74 | -8.55 | -10.80 | -12.77 | 7.95 | 15.90 |
August 3, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $1,069,000K ÷ $97,000K
= 11.02
The interest coverage ratio for The Gap, Inc. fluctuated over the periods provided. A high interest coverage ratio indicates that the company can easily meet its interest payments from its earnings, which is favorable for creditors. On the other hand, a low or negative interest coverage ratio implies that the company may have difficulty meeting its interest obligations from its operating income.
In the most recent period, as of August 3, 2024, The Gap, Inc. had an interest coverage ratio of 11.02, indicating a strong ability to cover its interest expenses. However, the ratio has shown some variability in previous periods, with values ranging from negative figures, indicating difficulty in covering interest expenses, to positive figures demonstrating an improvement in the company's ability to meet its interest obligations.
It is essential for stakeholders to closely monitor The Gap, Inc.'s interest coverage ratio over time to assess the company's financial health and its ability to manage its debt obligations effectively. The trend in the interest coverage ratio can provide valuable insights into the company's financial performance and stability.
Peer comparison
Aug 3, 2024