Strategic Education Inc (STRA)

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	157,276	173,467	165,604	145,433	114,258	87,329	66,794	68,826	79,864	84,252	87,347	95,015	110,585	94,386	104,971	119,092	135,536	165,096	164,230	147,276
Interest expense (ttm)	US$ in thousands	0	1,400	3,400	5,400	17,042	23,244	23,264	28,794	22,859	15,257	13,237	5,707	0	0	0	0	0	800	1,600	2,400
Interest coverage		—	123.90	48.71	26.93	6.70	3.76	2.87	2.39	3.49	5.52	6.60	16.65	—	—	—	—	—	206.37	102.64	61.36

December 31, 2024 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $157,276K ÷ $0K
= —

Interest coverage ratio measures a company's ability to cover its interest expenses with its operating income. Looking at the data provided for Strategic Education Inc, we observe fluctuations in the interest coverage ratio over time:

- As of March 31, 2020, the interest coverage ratio was high at 61.36, indicating that the company's operating income was more than sufficient to cover its interest expenses.
- This ratio significantly improved by June 30, 2020, reaching 102.64, suggesting a stronger ability to meet interest obligations.
- By September 30, 2020, the interest coverage ratio surged to 206.37, signaling a substantial increase in operating income relative to interest expenses.
- The data shows that from December 31, 2020, to September 30, 2022, the interest coverage ratio was not provided, possibly implying changes in the financial reporting or performance during that period.
- However, from March 31, 2022, to December 31, 2024, the interest coverage ratio decreased gradually, indicating a lower ability to cover interest expenses with operating income.
- Notably, the interest coverage ratio experienced fluctuations in the later periods, with some values dropping significantly before rising again.

In conclusion, the interest coverage ratio for Strategic Education Inc fluctuated over the periods analyzed, showing both improvements and declines in the company's ability to cover its interest expenses with operating income. These fluctuations may warrant further analysis to understand the factors influencing the company's financial performance and its ability to meet its debt obligations.