Johnson & Johnson (JNJ)
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 | 30,918,000 | 17,970,000 | 41,261,000 | 42,999,000 | 38,608,000 | 38,819,000 | 17,062,000 | 15,832,000 | 22,226,000 | 22,017,000 | 20,515,000 | 21,339,000 | 22,959,000 | 19,797,000 | 20,373,000 | 17,656,000 | 16,698,000 | 19,267,000 | 16,517,000 | 19,656,000 |
| Interest expense (ttm) | US$ in thousands | 155,000 | 306,000 | 498,000 | 844,000 | 901,000 | 927,000 | 786,000 | 478,000 | 276,000 | 159,000 | 128,000 | 130,000 | 183,000 | 210,000 | 234,000 | 239,000 | 201,000 | 199,000 | 203,000 | 241,000 |
| Interest coverage | 199.47 | 58.73 | 82.85 | 50.95 | 42.85 | 41.88 | 21.71 | 33.12 | 80.53 | 138.47 | 160.27 | 164.15 | 125.46 | 94.27 | 87.06 | 73.87 | 83.07 | 96.82 | 81.36 | 81.56 |
December 31, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $30,918,000K ÷ $155,000K
= 199.47
Johnson & Johnson's interest coverage ratio has fluctuated over the periods provided. The interest coverage ratio measures the company's ability to meet its interest payments on outstanding debt. A higher ratio indicates a stronger ability to meet interest obligations.
From March 2020 to December 2021, Johnson & Johnson's interest coverage remained consistently high, ranging from 73.87 to 125.46, demonstrating good financial health and a strong ability to service its debt. However, there was a significant increase in the interest coverage ratio by March 2022 to 164.15, indicating even stronger coverage of interest expenses.
The interest coverage ratio then decreased in the following periods, reaching a low of 21.71 by June 2023. This significant drop may suggest potential challenges in meeting interest payments or a higher level of debt burden compared to operating income.
However, from September 2023 onwards, the interest coverage ratio improved, signaling a recovery in the company's ability to handle interest expenses. By December 2024, the ratio had surged to 199.47, reflecting a robust position with ample earnings to cover interest payments comfortably.
Overall, while Johnson & Johnson experienced fluctuations in its interest coverage ratio over the observed periods, the company demonstrated a generally strong capacity to meet its interest obligations, with notable improvements in recent years.
Peer comparison
Dec 31, 2024