Micron Technology Inc (MU)
Interest coverage
| Aug 29, 2024 | May 30, 2024 | Feb 29, 2024 | Nov 30, 2023 | Aug 31, 2023 | Jun 1, 2023 | Mar 2, 2023 | Dec 1, 2022 | Sep 1, 2022 | Jun 2, 2022 | Mar 3, 2022 | Dec 2, 2021 | Sep 2, 2021 | Jun 3, 2021 | Mar 4, 2021 | Dec 3, 2020 | Sep 3, 2020 | May 28, 2020 | Feb 27, 2020 | Nov 28, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 1,667,000 | -1,180,000 | -3,677,000 | -6,161,000 | -5,268,000 | -2,350,000 | 2,316,000 | 7,058,000 | 9,764,000 | 11,168,000 | 9,986,000 | 8,106,000 | 6,438,000 | 4,615,000 | 3,691,000 | 3,470,000 | 3,161,000 | 2,658,000 | 2,470,000 | 3,924,000 |
| Interest expense (ttm) | US$ in thousands | 225,000 | 555,000 | 524,000 | 469,000 | 388,000 | 304,000 | 229,000 | 195,000 | 189,000 | 191,000 | 193,000 | 180,000 | 183,000 | 186,000 | 191,000 | 195,000 | 194,000 | 183,000 | 161,000 | 142,000 |
| Interest coverage | 7.41 | -2.13 | -7.02 | -13.14 | -13.58 | -7.73 | 10.11 | 36.19 | 51.66 | 58.47 | 51.74 | 45.03 | 35.18 | 24.81 | 19.32 | 17.79 | 16.29 | 14.52 | 15.34 | 27.63 |
August 29, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $1,667,000K ÷ $225,000K
= 7.41
Interest coverage ratio is a financial metric that indicates a company's ability to pay interest expenses on its outstanding debt. A higher interest coverage ratio suggests that the company has more earnings available to meet interest expenses.
For Micron Technology Inc, the interest coverage ratio has shown significant fluctuations over the given periods. The ratio was positive and above 1, indicating sufficient earnings to cover interest expenses, for most of the periods examined. However, there were instances of negative interest coverage which implies that the company's earnings were insufficient to cover its interest payments during those periods.
The interest coverage ratio ranged from a low of -13.58 to a high of 58.47. The negative ratios indicate periods of financial stress when the company's earnings were not adequate to cover its interest obligations. On the other hand, the positive ratios above 1, such as the ratios of 36.19, 51.66, and 58.47, demonstrate the company's strong ability to cover its interest expenses from its earnings.
Overall, it is important for investors and creditors to monitor Micron Technology Inc's interest coverage ratio consistently to assess the company's financial health and ability to meet its debt obligations. The fluctuations in the interest coverage ratio highlight the importance of evaluating the company's financial performance over time.
Peer comparison
Aug 29, 2024