Lincoln Electric Holdings Inc (LECO)
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 | 679,132 | 672,532 | 715,648 | 712,016 | 709,294 | 672,148 | 638,902 | 629,317 | 622,079 | 605,747 | 573,757 | 522,727 | 472,766 | 429,770 | 385,020 | 327,100 | 327,487 | 331,569 | 344,762 | 394,126 |
| Interest expense (ttm) | US$ in thousands | 42,786 | 40,077 | 38,912 | 39,950 | 44,372 | 44,342 | 41,743 | 36,503 | 29,500 | 26,345 | 23,849 | 23,053 | 22,214 | 21,818 | 21,656 | 21,874 | 21,973 | 22,685 | 23,533 | 23,550 |
| Interest coverage | 15.87 | 16.78 | 18.39 | 17.82 | 15.99 | 15.16 | 15.31 | 17.24 | 21.09 | 22.99 | 24.06 | 22.68 | 21.28 | 19.70 | 17.78 | 14.95 | 14.90 | 14.62 | 14.65 | 16.74 |
December 31, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $679,132K ÷ $42,786K
= 15.87
Interest coverage ratio is a measure of a company's ability to cover its interest expenses with its operating earnings. A higher interest coverage ratio indicates that a company is more capable of meeting its interest obligations.
Analyzing the interest coverage ratio of Lincoln Electric Holdings Inc over the past few years shows a general trend of improvement. The ratio has consistently remained above 10, indicating a strong ability to cover interest expenses.
From March 31, 2020, where the interest coverage was 16.74, the ratio improved steadily, reaching a peak of 24.06 on June 30, 2022. This suggests that Lincoln Electric Holdings Inc has been consistently generating enough operating earnings to comfortably cover its interest payments.
Despite some fluctuations, the interest coverage ratio remained healthy, even surpassing 15 during periods with lower values. For the most recent data available on December 31, 2024, the interest coverage ratio was 15.87, which is still considered a solid level.
Overall, Lincoln Electric Holdings Inc has demonstrated a strong ability to cover its interest expenses over the years, indicating financial stability and a healthy financial position.
Peer comparison
Dec 31, 2024