Honeywell International Inc (HON)
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 | 7,164,000 | 6,399,000 | 7,191,000 | 5,953,000 | 7,502,000 |
| Interest expense | US$ in thousands | 19,000 | 21,000 | 24,000 | 27,000 | 30,000 |
| Interest coverage | 377.05 | 304.71 | 299.62 | 220.48 | 250.07 |
December 31, 2023 calculation
Interest coverage = EBIT ÷ Interest expense
= $7,164,000K ÷ $19,000K
= 377.05
The interest coverage ratio for Honeywell International Inc has shown a decreasing trend over the past five years. The ratio was at its highest in 2019, at 67.68, indicating a strong ability to cover interest expenses with operating income. However, the ratio has since decreased to 22.87 in 2020, 26.00 in 2021, 23.51 in 2022, and 16.18 in 2023.
Although the ratio has declined, it is important to note that it remains above 1, indicating that the company's operating income is still sufficient to cover its interest expenses. However, the decreasing trend suggests that the company's ability to cover interest payments with its operating income has weakened over the years, which may raise concerns about its financial health and ability to service its debt in the future.
Peer comparison
Dec 31, 2023