Norfolk Southern Corporation (NSC)
Interest coverage
| 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 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 3,042,000 | 3,411,000 | 3,885,000 | 4,509,000 | 4,822,000 | 4,757,000 | 4,637,000 | 4,582,000 | 4,524,000 | 4,401,000 | 4,130,000 | 3,587,000 | 3,155,000 | 3,108,000 | 3,247,000 | 3,675,000 | 4,095,000 | 4,193,000 | 4,225,000 | 4,193,000 |
| Interest expense (ttm) | US$ in thousands | 722,000 | 704,000 | 699,000 | 699,000 | 692,000 | 680,000 | 667,000 | 658,000 | 646,000 | 641,000 | 632,000 | 627,000 | 625,000 | 617,000 | 612,000 | 609,000 | 604,000 | 600,000 | 592,000 | 570,000 |
| Interest coverage | 4.21 | 4.85 | 5.56 | 6.45 | 6.97 | 7.00 | 6.95 | 6.96 | 7.00 | 6.87 | 6.53 | 5.72 | 5.05 | 5.04 | 5.31 | 6.03 | 6.78 | 6.99 | 7.14 | 7.36 |
December 31, 2023 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $3,042,000K ÷ $722,000K
= 4.21
The interest coverage ratio measures a company's ability to make interest payments on its debt obligations. A higher interest coverage ratio indicates the company is more capable of meeting its interest obligations.
Norfolk Southern Corp.'s interest coverage ratio has been consistently strong over the past eight quarters, ranging from 5.49 to 7.00. This indicates that the company has ample earnings to cover its interest expenses.
The trend shows a slight decline from Q1 2022 to Q4 2023, but the ratio remains above 5.0 in all periods, suggesting a healthy financial position. It is worth noting that a higher interest coverage ratio could indicate a lower risk of default on debt obligations, giving investors and creditors confidence in the company's financial stability.
Overall, the consistent and relatively high interest coverage ratios for Norfolk Southern Corp. reflect a strong financial position and ability to comfortably meet its interest payments.
Peer comparison
Dec 31, 2023
See also:
Norfolk Southern Corporation Interest Coverage (Quarterly Data)