Masimo Corporation (MASI)
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 | -263,800 | 132,200 | 128,900 | 137,200 | 138,400 | 174,800 | 209,700 | 204,200 | 225,300 | 228,858 | 234,729 | 268,964 | 274,767 | 264,625 | 258,193 | 256,566 | 264,003 | 261,741 | 255,039 | 246,944 |
Interest expense (ttm) | US$ in thousands | 1,900 | 15,200 | 27,500 | 50,400 | 50,300 | 47,900 | 44,800 | 37,500 | 25,700 | 14,400 | 4,700 | 300 | 284 | 234 | 318 | 301 | 301 | 336 | 334 | 331 |
Interest coverage | -138.84 | 8.70 | 4.69 | 2.72 | 2.75 | 3.65 | 4.68 | 5.45 | 8.77 | 15.89 | 49.94 | 896.55 | 967.49 | 1,130.88 | 811.93 | 852.38 | 877.09 | 778.99 | 763.59 | 746.05 |
December 31, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $-263,800K ÷ $1,900K
= -138.84
The interest coverage ratio of Masimo Corporation has shown a fluctuating trend over the past few years. The ratio has been consistently high, indicating a strong ability of the company to meet its interest obligations through its operating income.
The interest coverage ratio peaked at a very high level in September 2021, indicating a significant cushion for the company to cover its interest expenses. However, the ratio declined significantly in the following quarters, dropping to very low levels by June 2022 and turning negative by December 2024. A negative interest coverage ratio indicates that the company's operating income is insufficient to cover its interest expenses.
This drastic decline in the interest coverage ratio raises concerns about Masimo Corporation's ability to service its debt obligations and the sustainability of its financial position. Further analysis of the company's financial performance and capital structure is recommended to assess the underlying factors contributing to this sharp decline in the interest coverage ratio.
Peer comparison
Dec 31, 2024