Universal Display (OLED)
Interest coverage
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | — | 217,189 | 267,110 | 227,644 | 157,526 |
| Interest expense | US$ in thousands | — | — | 7,811 | 603 | 6,003 |
| Interest coverage | — | — | 34.20 | 377.52 | 26.24 |
December 31, 2024 calculation
Interest coverage = EBIT ÷ Interest expense
= $—K ÷ $—K
= —
The interest coverage ratio measures a company's ability to meet its interest payments on outstanding debt. Looking at the data provided for Universal Display, we observe a fluctuating trend in the interest coverage ratio over the years. In December 31, 2020, the interest coverage ratio stood at 26.24, indicating that the company generated 26 times more operating income than it needed to cover its interest expenses.
A significant improvement was seen by December 31, 2021, where the interest coverage ratio surged to 377.52, highlighting the company's vastly improved ability to cover its interest obligations. This sharp increase suggests a substantial increase in operating income relative to the interest expenses incurred during this period, indicating a strengthened financial position.
However, by December 31, 2022, the interest coverage ratio decreased to 34.20, signifying that the operating income was 34.20 times the interest expense. Even though this ratio dropped from the previous year, it still indicates a healthy ability to meet interest payments.
The data for December 31, 2023, and December 31, 2024, indicates the absence of specific values (represented as "—"). This missing data can make it challenging to assess Universal Display's financial position accurately during those years.
In conclusion, the interest coverage ratio for Universal Display demonstrates fluctuations over the years, with notable improvements in some years and a slight decrease in others. This ratio is an essential indicator of the company's financial health and its ability to meet interest payments on its debt obligations.
Peer comparison
Dec 31, 2024