Globus Medical (GMED)

Interest coverage

		Dec 31, 2024	Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	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
Earnings before interest and tax (EBIT) (ttm)	US$ in thousands	259,162	260,652	279,674	298,937	273,506	256,780	247,812	249,173	240,119	204,387	199,634	178,027	184,045	218,468	215,447	141,204	115,472	106,836	99,805	168,090
Interest expense (ttm)	US$ in thousands	5,004	7,585	14,730	20,689	25,292	28,026	24,005	18,187	14,233	10,857	9,063	9,128	9,297	25,634	26,614	27,663	29,275	15,451	16,743	17,570
Interest coverage		51.79	34.36	18.99	14.45	10.81	9.16	10.32	13.70	16.87	18.83	22.03	19.50	19.80	8.52	8.10	5.10	3.94	6.91	5.96	9.57

December 31, 2024 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $259,162K ÷ $5,004K
= 51.79

The interest coverage ratio for Globus Medical has shown fluctuations over the years. It stood at 9.57 as of March 31, 2020, reflecting a strong ability to cover interest payments. However, this ratio decreased to 3.94 by December 31, 2020, indicating a potential strain on the company's ability to cover its interest expenses.

Subsequently, from March 31, 2021, to September 30, 2022, the interest coverage ratio gradually improved, reaching a peak of 22.03 on June 30, 2022, and 19.80 on December 31, 2021. This improvement suggests that the company was better able to cover its interest obligations during this period.

However, from September 30, 2022, the interest coverage ratio started to decline, falling to 9.16 by September 30, 2023. This decline may raise concerns about the company's ability to meet its interest payments.

The ratio then fluctuated between 10.81 on December 31, 2023, and 51.79 on December 31, 2024, showing significant variability in the company's ability to cover interest expenses during this period.

Overall, the trends in Globus Medical's interest coverage ratio indicate varying degrees of ability to meet its interest obligations, with some periods of strength and others of potential weakness. It is essential for stakeholders to closely monitor these fluctuations to assess the company's financial health and sustainability.