QuinStreet Inc (QNST)
Interest coverage
| Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | Jun 30, 2020 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | -29,716 | -20,572 | -4,687 | 30,625 | 19,382 |
| Interest expense | US$ in thousands | 680 | 790 | 1,075 | 1,296 | 696 |
| Interest coverage | -43.70 | -26.04 | -4.36 | 23.63 | 27.85 |
June 30, 2024 calculation
Interest coverage = EBIT ÷ Interest expense
= $-29,716K ÷ $680K
= -43.70
The interest coverage ratio measures a company's ability to pay interest expenses on its outstanding debt with its operating income. A higher interest coverage ratio indicates a stronger ability to meet interest obligations.
In the case of QuinStreet Inc, the interest coverage ratios for the past five years have fluctuated significantly. The negative values for the years 2020, 2021, 2022, 2023, and 2024 (-43.70, -26.04, -4.36, 23.63, 27.85, respectively) suggest that the company's operating income was insufficient to cover its interest expenses during those periods.
The sharp increase in the interest coverage ratio from negative values in 2022 and 2023 to positive values in 2024 indicates an improvement in the company's ability to cover its interest payments with operating income. However, the ratios still remain comparatively low, indicating that QuinStreet Inc may still be relatively strained in meeting its interest obligations.
Overall, QuinStreet Inc's interest coverage ratios show a volatile trend, highlighting the importance of closely monitoring the company's financial performance and debt management strategies to ensure sustainable long-term financial health.
Peer comparison
Jun 30, 2024