Lockheed Martin Corporation (LMT)
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 | 7,256,000 | 8,872,000 | 8,390,000 | 8,410,000 | 8,406,000 | 7,960,000 | 8,512,000 | 6,754,000 | 6,864,000 | 7,547,000 | 6,123,000 | 7,964,000 | 8,119,000 | 7,819,000 | 9,145,000 | 8,944,000 | 8,771,000 | 8,424,000 | 8,221,000 | 7,956,000 |
| Interest expense (ttm) | US$ in thousands | 1,036,000 | 1,026,000 | 1,007,000 | 969,000 | 849,000 | 797,000 | 705,000 | 623,000 | 623,000 | 567,000 | 563,000 | 564,000 | 569,000 | 572,000 | 576,000 | 583,000 | 591,000 | 599,000 | 616,000 | 630,000 |
| Interest coverage | 7.00 | 8.65 | 8.33 | 8.68 | 9.90 | 9.99 | 12.07 | 10.84 | 11.02 | 13.31 | 10.88 | 14.12 | 14.27 | 13.67 | 15.88 | 15.34 | 14.84 | 14.06 | 13.35 | 12.63 |
December 31, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $7,256,000K ÷ $1,036,000K
= 7.00
Lockheed Martin Corporation's interest coverage ratio provides insights into the company's ability to meet its interest obligations. A higher interest coverage ratio indicates a stronger ability to cover interest payments with its operating income.
Looking at the data provided, we can observe that Lockheed Martin's interest coverage ratio has generally been healthy and above 10 during the period under review. The ratio ranged between approximately 8.33 to 15.88, showing fluctuations over the quarters.
The trend showed a generally increasing interest coverage ratio from March 2020 to June 2021, indicating an improvement in the company's ability to cover its interest expenses with operating income. However, there was a slight decrease in the ratio from June 2021 to September 2021 and then another decline from June 2022 to December 2024. The ratio fell below 10 in March 2024 and continued to decline to 7.00 in December 2024.
A decreasing interest coverage ratio can suggest that Lockheed Martin may be facing challenges meeting its interest obligations in a sustainable manner, which could potentially raise concerns about its financial health and ability to service its debt.
It would be important for investors and stakeholders to closely monitor Lockheed Martin's interest coverage ratio in the future quarters to assess the company's financial stability and its capacity to handle its debt burden effectively.
See also:
Lockheed Martin Corporation Interest Coverage (Quarterly Data)