Service Corporation International (SCI)
Interest coverage
| 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 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 947,709 | 874,345 | 853,156 | 836,977 | 927,041 | 1,055,899 | 1,166,496 | 1,189,264 | 1,195,797 | 1,181,594 | 1,074,605 | 1,016,868 | 824,893 | 778,871 | 692,851 | 652,622 | 650,100 | 717,803 | 696,647 | 685,155 |
| Interest expense (ttm) | US$ in thousands | 239,447 | 223,906 | 205,902 | 186,997 | 172,109 | 161,852 | 156,962 | 153,826 | 150,610 | 148,089 | 150,192 | 154,524 | 163,063 | 171,297 | 177,254 | 182,804 | 185,843 | 188,427 | 188,168 | 185,370 |
| Interest coverage | 3.96 | 3.90 | 4.14 | 4.48 | 5.39 | 6.52 | 7.43 | 7.73 | 7.94 | 7.98 | 7.15 | 6.58 | 5.06 | 4.55 | 3.91 | 3.57 | 3.50 | 3.81 | 3.70 | 3.70 |
December 31, 2023 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $947,709K ÷ $239,447K
= 3.96
Service Corp. International's interest coverage ratio has shown a decreasing trend over the last eight quarters, starting at 7.54 in Q1 2022 and declining to 3.90 in Q4 2023. This indicates that the company's ability to cover its interest expenses with its earnings has weakened over time. A higher interest coverage ratio is generally preferred by investors and creditors as it demonstrates the company's ability to meet its interest obligations comfortably. However, it is important to note that the ratios above 1.5 usually indicate that the company has the ability to meet its interest payments. Despite the decreasing trend, all ratios are above 1.5, suggesting that Service Corp. International has been able to meet its interest obligations in all quarters analyzed. Continued monitoring of the trend and underlying factors impacting the company's interest coverage is recommended to assess its financial health and capacity to service debt effectively.
Peer comparison
Dec 31, 2023