Pure Storage Inc (PSTG)
Interest coverage
| Feb 4, 2024 | Nov 5, 2023 | Aug 6, 2023 | Feb 5, 2023 | Nov 6, 2022 | Aug 7, 2022 | May 8, 2022 | Feb 6, 2022 | Oct 31, 2021 | Aug 1, 2021 | May 2, 2021 | Jan 31, 2021 | Nov 1, 2020 | Aug 2, 2020 | May 3, 2020 | Feb 2, 2020 | Oct 31, 2019 | Jul 31, 2019 | Apr 30, 2019 | Jan 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 239,187 | 173,783 | 108,243 | 96,557 | 43,788 | 19,424 | -28,860 | -91,819 | -161,904 | -207,088 | -229,836 | -238,757 | -192,787 | -151,849 | -155,342 | -166,769 | -190,583 | -192,809 | -186,856 | -155,658 |
| Interest expense (ttm) | US$ in thousands | 7,247 | 6,322 | 5,229 | 4,749 | 13,510 | 21,496 | 29,500 | 36,677 | 35,597 | 34,483 | 32,911 | 31,403 | 29,745 | 28,833 | 28,381 | 27,897 | 27,521 | 27,150 | 26,784 | 21,615 |
| Interest coverage | 33.00 | 27.49 | 20.70 | 20.33 | 3.24 | 0.90 | -0.98 | -2.50 | -4.55 | -6.01 | -6.98 | -7.60 | -6.48 | -5.27 | -5.47 | -5.98 | -6.93 | -7.10 | -6.98 | -7.20 |
February 4, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $239,187K ÷ $7,247K
= 33.00
Interest coverage ratio is a financial metric used to evaluate a company's ability to cover its interest payments on outstanding debt with its operating income. A higher interest coverage ratio indicates a stronger ability to meet interest obligations.
Based on the data provided for Pure Storage Inc, we observe fluctuations in the interest coverage ratio over the past several reporting periods. The interest coverage ratio has been generally positive and above 1 in recent periods, indicating that the company has been generating sufficient operating income to cover its interest expenses.
However, there are some concerning trends in earlier periods, particularly in February 2020, where the interest coverage ratio dropped significantly, indicating potential difficulties in meeting interest obligations with operating income. The negative interest coverage ratios in certain periods suggest that the company's operating income was insufficient to cover its interest expenses during those specific time frames.
Overall, Pure Storage Inc's interest coverage ratio has shown variability over time, with both positive and negative trends. It is important for investors and stakeholders to monitor this ratio to assess the company's financial health and ability to manage its debt obligations effectively.
Peer comparison
Feb 4, 2024