Lamb Weston Holdings Inc (LW)
Interest coverage
| May 26, 2024 | Feb 25, 2024 | Nov 26, 2023 | Aug 27, 2023 | May 28, 2023 | Feb 26, 2023 | Nov 27, 2022 | Aug 28, 2022 | May 29, 2022 | Feb 27, 2022 | Nov 28, 2021 | Aug 29, 2021 | May 30, 2021 | Feb 28, 2021 | Nov 29, 2020 | Aug 30, 2020 | May 31, 2020 | Feb 23, 2020 | Nov 24, 2019 | Aug 25, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 1,065,300 | 1,039,800 | 1,082,200 | 1,048,400 | 882,100 | 831,100 | 698,600 | 541,200 | 444,400 | 407,300 | 374,100 | 399,300 | 474,800 | 406,800 | 468,700 | 522,600 | 556,900 | 674,000 | 705,300 | 685,800 |
| Interest expense (ttm) | US$ in thousands | 135,800 | 128,300 | 118,400 | 113,900 | 109,200 | 101,300 | 101,300 | 159,100 | 161,000 | 164,800 | 168,300 | 115,900 | 118,300 | 95,900 | 66,700 | 36,900 | 6,800 | 27,600 | 54,500 | 80,500 |
| Interest coverage | 7.84 | 8.10 | 9.14 | 9.20 | 8.08 | 8.20 | 6.90 | 3.40 | 2.76 | 2.47 | 2.22 | 3.45 | 4.01 | 4.24 | 7.03 | 14.16 | 81.90 | 24.42 | 12.94 | 8.52 |
May 26, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $1,065,300K ÷ $135,800K
= 7.84
The interest coverage ratio of Lamb Weston Holdings Inc has displayed fluctuating trends over the past several quarters, ranging from 2.22 to 81.90.
Generally, an interest coverage ratio above 1 indicates that a company is generating enough operating income to cover its interest expenses. Looking at the data, Lamb Weston's interest coverage has been consistently above 1, reflecting a healthy ability to meet its interest obligations.
There are significant variations in the interest coverage ratio throughout the periods, with the ratio reaching a peak of 81.90 in February 2020 and dropping to a low of 2.22 in November 2021. Such fluctuations may indicate changes in the company's financial health or performance.
The company experienced a notable decrease in its interest coverage ratio in November 2022 and August 2022, falling to 6.90 and 3.40, respectively, which might suggest increased financial risk. However, the ratio improved in subsequent quarters, reaching 9.20 in August 2023 and 9.14 in November 2023.
It is essential for investors and stakeholders to closely monitor Lamb Weston's interest coverage ratio going forward to assess its ability to manage interest expenses and maintain financial stability.
Peer comparison
May 26, 2024