Medtronic PLC (MDT)
Interest coverage
| Apr 26, 2024 | Jan 26, 2024 | Oct 27, 2023 | Jul 28, 2023 | Apr 28, 2023 | Jan 27, 2023 | Oct 28, 2022 | Jul 29, 2022 | Apr 29, 2022 | Jan 28, 2022 | Oct 29, 2021 | Jul 30, 2021 | Apr 30, 2021 | Jan 29, 2021 | Oct 30, 2020 | Jul 31, 2020 | Apr 24, 2020 | Jan 24, 2020 | Oct 25, 2019 | Jul 26, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 5,528,000 | 6,203,000 | 6,093,000 | 6,106,000 | 5,972,000 | 5,982,000 | 6,170,000 | 6,289,000 | 6,048,000 | 6,012,000 | 5,643,000 | 5,010,000 | 4,797,000 | 3,469,000 | 3,846,000 | 4,308,000 | 5,130,000 | 6,756,000 | 6,636,000 | 6,775,000 |
| Interest expense (ttm) | US$ in thousands | 718,000 | 703,000 | 682,000 | 620,000 | 636,000 | 592,000 | 562,000 | 580,000 | 553,000 | 552,000 | 558,000 | 892,000 | 926,000 | 946,000 | 959,000 | 654,000 | 1,092,000 | 1,648,000 | 1,735,000 | 1,811,000 |
| Interest coverage | 7.70 | 8.82 | 8.93 | 9.85 | 9.39 | 10.10 | 10.98 | 10.84 | 10.94 | 10.89 | 10.11 | 5.62 | 5.18 | 3.67 | 4.01 | 6.59 | 4.70 | 4.10 | 3.82 | 3.74 |
April 26, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $5,528,000K ÷ $718,000K
= 7.70
The interest coverage ratio for Medtronic PLC has demonstrated variability over the past few quarters. The interest coverage ratio indicates the company's ability to cover its interest expenses with its operating profits.
From October 2019 to January 2021, Medtronic PLC consistently maintained a strong interest coverage ratio above 10, reflecting a healthy ability to cover its interest payments. However, there was a notable decrease in the ratio in the subsequent quarters, with fluctuations between 5.18 and 6.59. This suggests a slight weakening in the company's ability to cover its interest expenses during this period.
The interest coverage ratio improved again from April 2021 onwards, with the ratio generally above 8. This rebound indicates a recovery in Medtronic PLC's ability to cover its interest obligations with operating income.
Overall, while there were fluctuations in Medtronic PLC's interest coverage ratio in recent quarters, the company has generally maintained a satisfactory ability to meet its interest obligations with its operating profits. Monitoring this ratio in the future will be crucial to assess the company's financial health and ability to manage its debt effectively.
Peer comparison
Apr 26, 2024