Teledyne Technologies Incorporated (TDY)

Interest coverage

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Earnings before interest and tax (EBIT)	US$ in thousands	995,800	1,044,400	1,003,000	610,200	488,900
Interest expense	US$ in thousands	57,900	85,500	89,300	104,200	15,300
Interest coverage		17.20	12.22	11.23	5.86	31.95

December 31, 2024 calculation

Interest coverage = EBIT ÷ Interest expense
= $995,800K ÷ $57,900K
= 17.20

Teledyne Technologies Incorporated's interest coverage ratio has shown fluctuations over the past five years. In December 2020, the interest coverage ratio was a robust 31.95, indicating that the company's operating income was sufficient to cover its interest expenses almost 32 times over. However, by December 2021, the ratio had decreased significantly to 5.86, which might suggest a weakening ability to cover interest payments.

The trend reversed in the subsequent years, with the interest coverage ratio increasing to 11.23 in 2022, 12.22 in 2023, and further to 17.20 by the end of 2024. These improvements indicate that Teledyne Technologies' ability to cover its interest expenses with operating income strengthened in these years, reaching a healthier level in 2024.

Overall, while the company experienced a temporary decline in its interest coverage ratio in 2021, it managed to recover and improve its financial health in the following years, with a notably strong interest coverage ratio by the end of 2024. Investors and stakeholders may view this positive trend as a sign of improved financial stability and management effectiveness.