Public Service Enterprise Group Inc (PEG)
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 | 3,829,000 | 1,630,000 | -518,000 | 2,901,000 | 2,519,000 |
| Interest expense | US$ in thousands | 748,000 | 628,000 | 571,000 | 600,000 | 569,000 |
| Interest coverage | 5.12 | 2.60 | -0.91 | 4.84 | 4.43 |
December 31, 2023 calculation
Interest coverage = EBIT ÷ Interest expense
= $3,829,000K ÷ $748,000K
= 5.12
Public Service Enterprise Group Inc.'s interest coverage ratio has shown fluctuations over the past five years, ranging from 2.46 in 2022 to 5.31 in 2023. The interest coverage ratio measures the company's ability to meet its interest obligations from its operating profits. A higher interest coverage ratio indicates that the company is more capable of meeting its interest payments.
In 2023, the interest coverage ratio improved significantly to 5.31, reflecting a strong ability to cover interest expenses with operating profits. This may indicate improved profitability or lower interest expenses. However, the ratio was lower in 2022 at 2.46, suggesting a potential decrease in profitability or an increase in interest expenses that year.
Overall, the trend in interest coverage ratios for Public Service Enterprise Group Inc. shows some variability, but the company generally maintained a healthy ability to cover its interest obligations over the past five years. Investors and creditors may view the increasing trend in the interest coverage ratio positively as it indicates improved financial health and reduced risk of default on interest payments.
Peer comparison
Dec 31, 2023