EchoStar Corporation (SATS)
Interest coverage
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | -277,909 | 189,644 | 217,010 | 112,473 | 208,587 |
| Interest expense | US$ in thousands | 104,447 | 57,170 | 95,512 | 147,927 | 251,016 |
| Interest coverage | -2.66 | 3.32 | 2.27 | 0.76 | 0.83 |
December 31, 2023 calculation
Interest coverage = EBIT ÷ Interest expense
= $-277,909K ÷ $104,447K
= -2.66
The interest coverage ratio measures a company's ability to meet its interest obligations on outstanding debt. A higher ratio indicates a stronger ability to cover interest expenses with operating income.
In the case of EchoStar Corporation, the interest coverage ratio has fluctuated over the past five years:
- Dec 31, 2023: The interest coverage ratio was -2.66, indicating that the company's operating income was not sufficient to cover its interest expenses, which raises concerns about its financial health and ability to meet debt obligations.
- Dec 31, 2022: The interest coverage ratio improved to 3.32, suggesting that the company's operating income was more than sufficient to cover its interest expenses.
- Dec 31, 2021: The interest coverage ratio was 2.27, indicating a decent ability to cover interest expenses with operating income.
- Dec 31, 2020: The interest coverage ratio was 0.76, which is a lower level and raises concerns about the company's ability to cover its interest expenses with its operating income.
- Dec 31, 2019: The interest coverage ratio was 0.83, which also indicates a lower ability to cover interest expenses with operating income.
Overall, the trend in EchoStar Corporation's interest coverage ratio suggests some inconsistency in its ability to cover interest expenses with operating income, with periods of both strength and weakness. Further analysis of the company's financial health and debt management practices is recommended to gain a more comprehensive understanding of its financial stability.
Peer comparison
Dec 31, 2023