Ormat Technologies Inc (ORA)

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	229,263	192,650	187,017	180,197	168,326	192,440	183,880	181,992	169,600	173,947	187,563	206,240	230,412	224,498	217,009	214,338	214,092	230,081	215,239	207,921
Interest expense (ttm)	US$ in thousands	98,881	96,919	94,268	90,293	87,743	86,688	86,515	84,723	82,658	79,011	78,537	79,696	77,953	76,382	74,702	76,434	80,384	84,850	83,474	77,803
Interest coverage		2.32	1.99	1.98	2.00	1.92	2.22	2.13	2.15	2.05	2.20	2.39	2.59	2.96	2.94	2.90	2.80	2.66	2.71	2.58	2.67

December 31, 2023 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $229,263K ÷ $98,881K
= 2.32

Interest coverage is a financial ratio that indicates a company's ability to cover its interest expenses with its operating income. A higher interest coverage ratio is generally seen as a positive sign, as it shows that the company is generating enough income to meet its interest obligations comfortably.

Based on the data provided for Ormat Technologies Inc over the eight quarters, the interest coverage ratio has remained relatively consistent, ranging between 1.96 and 2.22. This indicates that the company has generally been able to cover its interest expenses by at least 1.96 times with its operating income.

The consistency of the interest coverage ratio suggests that Ormat Technologies Inc has maintained a stable ability to service its debt obligations over the past two years. However, it is important for the company to continue monitoring this ratio to ensure its sustainability, particularly in the changing economic environment.