Meritage Corporation (MTH)
Interest coverage
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 949,430 | 1,289,360 | 955,152 | 535,743 | 311,315 |
| Interest expense | US$ in thousands | 0 | 41 | 318 | 2,177 | 8,370 |
| Interest coverage | — | 31,447.80 | 3,003.62 | 246.09 | 37.19 |
December 31, 2023 calculation
Interest coverage = EBIT ÷ Interest expense
= $949,430K ÷ $0K
= —
The interest coverage ratio for Meritage Homes Corp. has exhibited significant fluctuations over the past five years. In 2019, the company had an interest coverage ratio of 36.72, which decreased substantially in 2020 to 243.03, and then further increased in 2021 to 3,045.52. However, in the most recent year, 2022, the interest coverage ratio spiked to 31,381.46. The absence of data for 2023 prevents a direct comparison with prior years.
Such a high interest coverage ratio in 2022 indicates that Meritage Homes Corp. earned significantly more operating income relative to its interest expenses, reflecting a strong financial position in managing its debt obligations. This notable improvement from the previous years could signify improved operational efficiencies, better cost management, or a change in the capital structure.
It is recommended to continue monitoring the interest coverage ratio in future periods to assess the company's ability to meet interest payments on outstanding debt obligations. Additionally, a closer examination of Meritage Homes Corp.'s financial statements and market conditions may provide insights into the factors driving these fluctuations in the interest coverage ratio.
Peer comparison
Dec 31, 2023