Pure Storage Inc (PSTG)
Interest coverage
| Jan 31, 2025 | Feb 4, 2024 | Jan 31, 2024 | Feb 5, 2023 | Jan 31, 2023 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 155,647 | 98,069 | 98,069 | 96,557 | 83,513 |
| Interest expense | US$ in thousands | 7,813 | 7,483 | 7,483 | 4,749 | 4,749 |
| Interest coverage | 19.92 | 13.11 | 13.11 | 20.33 | 17.59 |
January 31, 2025 calculation
Interest coverage = EBIT ÷ Interest expense
= $155,647K ÷ $7,813K
= 19.92
Interest coverage is a financial ratio that indicates a company's ability to pay interest expenses on its outstanding debt. A higher interest coverage ratio suggests that the company is more capable of meeting its interest obligations.
Based on the data provided for Pure Storage Inc, the interest coverage ratio fluctuated over the years. As of January 31, 2023, the interest coverage ratio was 17.59, indicating that the company generated 17.59 times the amount needed to cover its interest expense. This ratio improved to 20.33 by February 5, 2023, suggesting a stronger financial position.
However, there was a decline in the interest coverage ratio to 13.11 on both January 31, 2024, and February 4, 2024. This decrease might indicate a potential strain on Pure Storage Inc's ability to cover its interest payments with its earnings.
Fortunately, the interest coverage ratio rebounded to 19.92 by January 31, 2025, showing an improvement in the company's capacity to handle interest costs. Overall, while Pure Storage Inc experienced fluctuations in its interest coverage ratio over the years, the recent increase to 19.92 reflects a more robust financial position compared to previous periods.
Peer comparison
Jan 31, 2025