SPS Commerce Inc (SPSC)

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	88,883	87,024	82,052	75,920	77,247	73,376	72,467	71,402	71,182	67,541	61,372	58,933	55,085	53,269	53,702	51,284	50,158	47,365	44,344	42,563
Interest expense (ttm)	US$ in thousands	0	1,276	1,276	1,276	2,552	3,028	3,723	5,061	4,208	2,456	1,761	423	0	121	237	463	1,103	1,696	2,423	3,010
Interest coverage		—	68.20	64.30	59.50	30.27	24.23	19.46	14.11	16.92	27.50	34.85	139.32	—	440.24	226.59	110.76	45.47	27.93	18.30	14.14

December 31, 2024 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $88,883K ÷ $0K
= —

Interest coverage ratio measures a company's ability to cover its interest expenses with its earnings before interest and taxes (EBIT). A higher interest coverage ratio indicates that the company is more capable of meeting its interest obligations.

Looking at the data provided for SPS Commerce Inc, we can see a fluctuating trend in the interest coverage ratio over the quarters.

- The interest coverage ratio was 14.14 as of March 31, 2020, and showed a consistent increase reaching a peak of 440.24 on September 30, 2021.
- However, there was a notable absence of data for December 31, 2021, and December 31, 2024.
- The ratio dropped significantly to 16.92 on December 31, 2022, showing some strain in covering interest expenses.
- Subsequently, the ratio fluctuated within a range, showing values such as 14.11 on March 31, 2023, and 68.20 on September 30, 2024, indicating inconsistent performance in terms of covering interest payments.

In conclusion, while SPS Commerce Inc has shown a strong capacity to cover its interest expenses at certain points, there are periods where the ratio dips, suggesting the need for consistent monitoring of the company's ability to manage its interest obligations.