Installed Building Products Inc (IBP)
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 | 284,900 | 383,000 | 363,357 | 360,976 | 349,452 | 353,835 | 365,789 | 365,317 | 345,411 | 291,636 | 252,624 | 214,272 | 188,317 | 184,418 | 174,933 | 163,453 | 161,468 | 151,485 | 143,351 | 131,875 |
| Interest expense (ttm) | US$ in thousands | 36,900 | 35,584 | 37,602 | 39,230 | 37,030 | 39,151 | 40,101 | 40,674 | 41,574 | 41,730 | 38,749 | 35,868 | 32,842 | 30,393 | 30,270 | 30,507 | 30,291 | 31,000 | 31,894 | 29,786 |
| Interest coverage | 7.72 | 10.76 | 9.66 | 9.20 | 9.44 | 9.04 | 9.12 | 8.98 | 8.31 | 6.99 | 6.52 | 5.97 | 5.73 | 6.07 | 5.78 | 5.36 | 5.33 | 4.89 | 4.49 | 4.43 |
December 31, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $284,900K ÷ $36,900K
= 7.72
Installed Building Products Inc's interest coverage ratio has shown a favorable trend over the period from March 31, 2020, to December 31, 2024. The interest coverage ratio indicates the company's ability to cover its interest expenses with its operating income.
The interest coverage ratio started at 4.43 on March 31, 2020, and gradually increased to 10.76 by September 30, 2024. This indicates that the company's operating income has been increasing at a faster rate than its interest expenses during this period. A higher interest coverage ratio is generally considered positive as it suggests the company is in a better position to meet its interest obligations.
However, there was a slight decline in the interest coverage ratio in the following quarter, dropping to 7.72 on December 31, 2024. It's important for stakeholders to monitor the company's interest coverage ratio regularly to ensure its ability to continue servicing its debt obligations. Overall, the increasing trend in the interest coverage ratio signifies a positive financial performance for Installed Building Products Inc.
Peer comparison
Dec 31, 2024