La-Z-Boy Incorporated (LZB)
Interest coverage
| Apr 27, 2024 | Jan 27, 2024 | Oct 28, 2023 | Jul 29, 2023 | Apr 29, 2023 | Jan 28, 2023 | Oct 29, 2022 | Jul 30, 2022 | Apr 30, 2022 | Jan 22, 2022 | Oct 23, 2021 | Jul 24, 2021 | Apr 24, 2021 | Jan 23, 2021 | Oct 24, 2020 | Jul 25, 2020 | Apr 25, 2020 | Jan 25, 2020 | Oct 26, 2019 | Jul 27, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 150,796 | 154,772 | 165,051 | 193,322 | 211,439 | 236,151 | 232,798 | 225,028 | 206,756 | 178,029 | 172,956 | 166,782 | 136,736 | 100,104 | 118,003 | 99,665 | 118,762 | 142,507 | 131,037 | 129,936 |
| Interest expense (ttm) | US$ in thousands | 455 | 451 | 481 | 499 | 536 | 596 | 620 | 743 | 895 | 1,000 | 1,138 | 1,242 | 1,390 | 1,503 | 1,470 | 1,432 | 1,291 | 1,290 | 1,563 | 1,756 |
| Interest coverage | 331.42 | 343.18 | 343.14 | 387.42 | 394.48 | 396.23 | 375.48 | 302.86 | 231.01 | 178.03 | 151.98 | 134.29 | 98.37 | 66.60 | 80.27 | 69.60 | 91.99 | 110.47 | 83.84 | 74.00 |
April 27, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $150,796K ÷ $455K
= 331.42
La-Z-Boy Incorporated has demonstrated consistently strong interest coverage ratios over the past few years. The interest coverage ratio measures the company's ability to cover its interest expenses with its operating income. The company's interest coverage has ranged from a high of 394.48 to a low of 66.60 over the periods analyzed, indicating a robust ability to meet its interest obligations.
A higher interest coverage ratio is generally considered favorable as it indicates that the company has sufficient earnings to cover its interest expenses. La-Z-Boy's interest coverage ratio has consistently remained well above 100, reflecting a healthy financial position and a low risk of default on its debt obligations.
The downward trend in the interest coverage ratio in recent periods, particularly from the peak of 394.48 to 66.60, may raise some concerns about the company's ability to comfortably cover its interest payments. It is important for investors and stakeholders to monitor this ratio closely to ensure that the company's financial health remains stable in the face of changing market conditions.
Peer comparison
Apr 27, 2024