Leidos Holdings Inc (LDOS)
Interest coverage
| Dec 31, 2024 | Sep 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 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 1,713,000 | 956,000 | 771,000 | 621,000 | 525,000 | 1,142,000 | 1,082,000 | 1,088,000 | 1,093,000 | 1,117,000 | 1,115,000 | 1,152,000 | 1,181,000 | 1,134,000 | 1,114,000 | 998,000 | 960,000 | 951,000 | 912,000 | 912,000 |
| Interest expense (ttm) | US$ in thousands | 191,000 | 197,000 | 207,000 | 212,000 | 214,000 | 211,000 | 205,000 | 199,000 | 194,000 | 191,000 | 187,000 | 184,000 | 184,000 | 181,000 | 176,000 | 179,000 | 167,000 | 151,000 | 143,000 | 133,000 |
| Interest coverage | 8.97 | 4.85 | 3.72 | 2.93 | 2.45 | 5.41 | 5.28 | 5.47 | 5.63 | 5.85 | 5.96 | 6.26 | 6.42 | 6.27 | 6.33 | 5.58 | 5.75 | 6.30 | 6.38 | 6.86 |
December 31, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $1,713,000K ÷ $191,000K
= 8.97
Leidos Holdings Inc's interest coverage ratio indicates the company's ability to meet its interest obligations with its operating income. From December 31, 2019, to December 31, 2021, the interest coverage ratio remained relatively stable, ranging from 5.58 to 6.86. This consistency suggests that Leidos had a strong ability to cover its interest expenses with its earnings during this period.
However, starting from March 31, 2022, the interest coverage ratio began to decline gradually, reaching 5.28 by March 31, 2023. This downtrend continued, with the ratio dropping significantly to 2.45 by September 30, 2023, indicating a potential weakening of Leidos' ability to cover its interest costs.
Subsequently, there was a slight improvement in the interest coverage ratio, reaching 8.97 by December 31, 2024. This increase suggests that Leidos may have adjusted its operational performance to better manage its interest payments.
Overall, it is essential for investors and stakeholders to monitor Leidos' interest coverage ratio closely as a decreasing trend could signal financial distress and inadequate profitability to cover debt obligations. Further analysis of the company's financial health and operational efficiency is recommended to understand the underlying factors influencing the changes in the interest coverage ratio.
Peer comparison
Dec 31, 2024