L3Harris Technologies Inc (LHX)
Interest coverage
| 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 | Sep 30, 2019 | Jun 30, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 4,010,000 | 2,634,000 | 1,444,000 | 1,995,000 | 845,000 | 1,072,000 | 1,217,000 | 829,000 | 2,515,000 | 2,446,000 | 3,710,000 | -209,000 | 758,000 | 1,909,000 | 1,623,000 | 1,800,000 | 1,561,000 | 1,478,000 | 1,481,000 | 1,278,000 |
| Interest expense (ttm) | US$ in thousands | 678,000 | 617,000 | 543,000 | 446,000 | 357,000 | 313,000 | 279,000 | 272,000 | 269,000 | 267,000 | 268,000 | 269,000 | 268,000 | 271,000 | 270,000 | 269,000 | 242,000 | 217,000 | 192,000 | 169,000 |
| Interest coverage | 5.91 | 4.27 | 2.66 | 4.47 | 2.37 | 3.42 | 4.36 | 3.05 | 9.35 | 9.16 | 13.84 | -0.78 | 2.83 | 7.04 | 6.01 | 6.69 | 6.45 | 6.81 | 7.71 | 7.56 |
June 30, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $4,010,000K ÷ $678,000K
= 5.91
Interest coverage ratio is a measure of a company's ability to meet its interest obligations on outstanding debt. A higher interest coverage ratio indicates a stronger ability to cover interest expenses.
Analyzing L3Harris Technologies Inc's interest coverage ratio over the past few quarters, we observe fluctuations in the ratio. As of June 30, 2024, the interest coverage ratio was 7.92, indicating that the company earned 7.92 times the amount of interest owed on its debt for that period.
The trend in interest coverage appears to be somewhat erratic, with ratios ranging from as low as -0.78 on December 31, 2021, to as high as 13.84 on March 31, 2022. The negative interest coverage ratio in December 31, 2021, is a concerning sign as it suggests that the company's operating income was insufficient to cover its interest expenses during that quarter.
Overall, the interest coverage ratios for L3Harris Technologies Inc demonstrate some volatility, indicating varying degrees of risk in terms of the company's ability to service its debt. Investors and creditors may want to further examine the company's financial health and stability to assess the potential impact of these fluctuations on its long-term financial performance.
Peer comparison
Jun 30, 2024