Sturm Ruger & Company Inc (RGR)
Interest coverage
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 33,187 | 33,816 | 38,285 | 49,576 | 59,029 | 68,707 | 81,575 | 87,442 | 108,535 | 131,604 | 157,251 | 190,790 | 203,136 | 200,452 | 186,584 | 150,941 | 119,148 | 86,928 | 59,645 | 43,084 |
| Interest expense (ttm) | US$ in thousands | 102 | 94 | 192 | 197 | 205 | 228 | 194 | 190 | 256 | 223 | 249 | 248 | 182 | 189 | 189 | 191 | 191 | 217 | 193 | 191 |
| Interest coverage | 325.36 | 359.74 | 199.40 | 251.65 | 287.95 | 301.35 | 420.49 | 460.22 | 423.96 | 590.15 | 631.53 | 769.31 | 1,116.13 | 1,060.59 | 987.22 | 790.27 | 623.81 | 400.59 | 309.04 | 225.57 |
December 31, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $33,187K ÷ $102K
= 325.36
The interest coverage ratio measures a company's ability to meet its interest payments on outstanding debt obligations. A higher interest coverage ratio indicates that the company is more capable of servicing its debt.
Analyzing the interest coverage ratios of Sturm Ruger & Company Inc over the past few years, we observe a generally positive trend. The ratios have been consistently above 100, indicating that the company has more than enough income to cover its interest expenses.
From March 31, 2020, to December 31, 2021, the interest coverage ratio steadily increased from 225.57 to 1,116.13, showing a significant improvement in the company's ability to pay off its interest obligations.
However, from March 31, 2022, to December 31, 2024, we see a decline in the interest coverage ratio, dropping to 325.36 by the end of December 2024. This decrease could indicate a potential strain on the company's ability to service its debt in the future.
Overall, while Sturm Ruger & Company Inc has demonstrated strong interest coverage ratios historically, the recent decline raises some concerns about its future financial stability in meeting interest payment obligations. Investors and stakeholders may need to monitor this trend closely to assess the company's debt servicing capacity.
Peer comparison
Dec 31, 2024