Public Service Enterprise Group Inc (PEG)
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 | 2,707,000 | 3,829,000 | 1,630,000 | -518,000 | 2,901,000 |
| Interest expense | US$ in thousands | 882,000 | 748,000 | 628,000 | 571,000 | 600,000 |
| Interest coverage | 3.07 | 5.12 | 2.60 | -0.91 | 4.84 |
December 31, 2024 calculation
Interest coverage = EBIT ÷ Interest expense
= $2,707,000K ÷ $882,000K
= 3.07
Public Service Enterprise Group Inc's interest coverage ratio has shown fluctuations over the past five years. In December 2020, the ratio stood at 4.84, indicating that the company earned nearly 4.84 times the interest charges on its debt. However, the ratio turned negative in December 2021, reaching -0.91. This suggests that the company's operating income was insufficient to cover its interest expenses during that period.
By December 2022, the interest coverage ratio improved to 2.60, showing a modest recovery in the company's ability to meet its interest obligations. The trend continued to strengthen by December 2023, with the ratio climbing to 5.12, indicating that Public Service Enterprise Group Inc was generating more than enough operating income to cover its interest payments.
In the most recent data point, December 2024, the interest coverage ratio slightly decreased to 3.07. While still above 1, this indicates a lower margin of safety in covering interest expenses compared to previous years. Overall, the fluctuations in Public Service Enterprise Group Inc's interest coverage ratio reflect varying levels of financial health and ability to manage debt obligations over the five-year period.
Peer comparison
Dec 31, 2024