Hertz Global Holdings Inc (HTZ)
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 | -2,281,000 | -2,263,000 | -112,000 | 480,000 | 1,073,000 | 834,000 | 828,000 | 1,701,000 | 2,117,000 | 2,573,000 | 2,633,000 | 1,381,000 | 1,153,000 | 963,000 | 0 | -842,000 | -1,444,000 | -1,136,000 | -557,000 | 554,000 |
| Interest expense (ttm) | US$ in thousands | 959,000 | 917,000 | 896,000 | 847,000 | 793,000 | 703,000 | 548,000 | 446,000 | 328,000 | 269,000 | 262,000 | 365,000 | 469,000 | 530,000 | 594,000 | 581,000 | 608,000 | 697,000 | 774,000 | 797,000 |
| Interest coverage | -2.38 | -2.47 | -0.12 | 0.57 | 1.35 | 1.19 | 1.51 | 3.81 | 6.45 | 9.57 | 10.05 | 3.78 | 2.46 | 1.82 | 0.00 | -1.45 | -2.38 | -1.63 | -0.72 | 0.70 |
December 31, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $-2,281,000K ÷ $959,000K
= -2.38
Based on the data provided for Hertz Global Holdings Inc's interest coverage ratio over the periods ranging from March 31, 2020, to December 31, 2024, the trend shows fluctuations and significant variability. The interest coverage ratio is a measure of a company's ability to meet its interest obligations with its earnings before interest and taxes (EBIT).
The interest coverage ratio was below 1 in multiple quarters, indicating that Hertz Global Holdings Inc had insufficient earnings to cover its interest expenses during those periods. This is concerning as a ratio below 1 implies that the company's earnings were not enough to cover its interest payments, potentially signaling financial distress.
However, there has been a noticeable improvement in the interest coverage ratio over the quarters from March 31, 2022, to June 30, 2023, where the ratio increased to levels above 3, indicating the company's ability to cover its interest expenses significantly improved during this period.
It is important to note the fluctuations in the interest coverage ratio, especially the negative ratios recorded in some quarters, which suggest the company may have faced challenges in generating sufficient earnings to meet its interest obligations. The positive trend in the more recent quarters, particularly from March 31, 2022, to June 30, 2023, indicates some recovery in the firm's financial standing regarding interest coverage.
Overall, continuous monitoring of the interest coverage ratio is crucial to assess Hertz Global Holdings Inc's financial health and ability to manage its debt obligations effectively.
Peer comparison
Dec 31, 2024