Gen Digital Inc. (GEN)
Interest coverage
| Mar 31, 2024 | Mar 31, 2023 | Mar 31, 2022 | Mar 31, 2021 | Mar 31, 2020 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 1,122,000 | 1,227,000 | 1,005,000 | 896,000 | 355,000 |
| Interest expense | US$ in thousands | 669,000 | 401,000 | 126,000 | 144,000 | 196,000 |
| Interest coverage | 1.68 | 3.06 | 7.98 | 6.22 | 1.81 |
March 31, 2024 calculation
Interest coverage = EBIT ÷ Interest expense
= $1,122,000K ÷ $669,000K
= 1.68
The interest coverage ratio for Gen Digital Inc. has fluctuated over the past five years. It was at its lowest in 2020 at 1.81 and then increased in the following years to 6.22 in 2021, 7.98 in 2022, and further to 3.06 in 2023, which demonstrates an improving ability to cover its interest expenses.
However, in the most recent period ending on March 31, 2024, the interest coverage ratio decreased to 1.68. This decline could signify that Gen Digital Inc.'s ability to cover its interest payments with operating income has weakened compared to the previous years. A lower interest coverage ratio may raise concerns about the company's financial health and its ability to meet its debt obligations.
It is important for stakeholders to closely monitor Gen Digital Inc.'s interest coverage ratio in the upcoming periods to assess whether this declining trend persists or if it improves. Sustainable improvement in the interest coverage ratio is crucial to demonstrate the company's financial stability and ability to manage its debt effectively.
Peer comparison
Mar 31, 2024