SkyWest Inc (SKYW)

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	104,069	41,383	67,668	124,410	181,162	249,178	220,652	247,073	275,867	215,246	242,749	123,323	108,802	261,776	333,664	482,160	512,258	475,128	455,365	449,197
Interest expense (ttm)	US$ in thousands	130,930	134,656	135,396	132,111	127,083	121,156	116,853	120,360	123,122	126,167	127,337	124,323	123,173	122,151	123,607	125,451	127,754	130,807	130,641	126,682
Interest coverage		0.79	0.31	0.50	0.94	1.43	2.06	1.89	2.05	2.24	1.71	1.91	0.99	0.88	2.14	2.70	3.84	4.01	3.63	3.49	3.55

December 31, 2023 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $104,069K ÷ $130,930K
= 0.79

The interest coverage of Skywest Inc. fluctuated over the past eight quarters, with Q3 2022 having the highest coverage at 2.24 and Q3 2023 the lowest at 0.44. The interest coverage ratio measures the company's ability to meet its interest obligations with its earnings before interest and taxes (EBIT). A higher interest coverage ratio indicates a company is more capable of meeting its interest payments.

The decreasing trend in interest coverage from Q3 2022 to Q3 2023 raises concerns about the company's ability to cover its interest expenses with its operating income. Investors and creditors may view a declining interest coverage ratio as a signal of potential financial distress. Monitoring this ratio closely can provide valuable insights into Skywest Inc.'s financial health and sustainability. Further analysis of the company's financial statements and operational performance is advisable to understand the underlying factors driving these fluctuations in interest coverage.