Lululemon Athletica Inc. (LULU)

Interest coverage

		Jan 31, 2025	Oct 31, 2024	Jul 31, 2024	Apr 30, 2024	Jan 31, 2024	Jan 28, 2024	Oct 31, 2023	Oct 29, 2023	Jul 31, 2023	Jul 30, 2023	Apr 30, 2023	Jan 31, 2023	Jan 29, 2023	Oct 31, 2022	Oct 30, 2022	Jul 31, 2022	May 1, 2022	Apr 30, 2022	Jan 31, 2022	Jan 30, 2022
Earnings before interest and tax (EBIT) (ttm)	US$ in thousands	2,015,038	1,914,229	2,828,119	2,700,509	2,605,982	2,051,748	1,617,115	1,605,913	2,398,048	2,325,347	2,198,517	2,149,530	1,400,128	1,346,049	1,253,969	1,495,018	1,704,726	1,750,580	1,781,264	1,495,105
Interest expense (ttm)	US$ in thousands	0	0	0	0	0	0	0	8,025	28,839	49,653	49,984	42,290	41,981	21,189	20,880	100,079	159,104	207,321	223,489	160,149
Interest coverage		—	—	—	—	—	—	—	200.11	83.15	46.83	43.98	50.83	33.35	63.53	60.06	14.94	10.71	8.44	7.97	9.34

January 31, 2025 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $2,015,038K ÷ $0K
= —

The interest coverage ratio is a financial metric that indicates a company's ability to pay its interest expenses on outstanding debt. A higher interest coverage ratio is generally considered favorable as it suggests that the company is generating sufficient operating income to cover its interest obligations.

Looking at the data provided for Lululemon Athletica Inc., we observe fluctuations in the interest coverage ratio over time. The interest coverage ratio ranged from a low of 7.97 in January 31, 2022, to a high of 200.11 in October 29, 2023.

The trend shows that the interest coverage ratio improved significantly from 2022 to 2023, indicating that the company's ability to cover its interest expenses strengthened during this period. The ratio peaked in October 2023, reaching a very high value of 200.11, which suggests a substantial improvement in Lululemon's financial health and operational performance.

However, it is important to note that there were instances where the interest coverage ratio was not provided ("—"), particularly in the latter years of the data. It is crucial for investors and stakeholders to closely monitor the company's interest coverage ratio and financial performance during these periods of missing data to assess any potential risks related to its debt obligations.

In conclusion, based on the data provided, Lululemon Athletica Inc. has shown fluctuations in its interest coverage ratio over time, with a notable improvement in its ability to cover interest expenses from 2022 to 2023. Continued monitoring of the company's financial health and debt management is advisable to ensure sustainable growth and financial stability.