Taylor Morn Home (TMHC)

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	1,155,747	1,074,738	971,133	1,019,961	1,020,341	1,164,068	1,335,814	1,409,265	1,391,488	1,355,127	1,175,251	948,202	844,306	628,487	555,333	474,670	316,177	253,769	196,475	224,276
Interest expense (ttm)	US$ in thousands	2,890	2,964	3,053	3,188	3,315	3,260	3,460	2,937	2,260	1,758	847	612	539	473	15	-1,328	-1,852	-1,122	-277	838
Interest coverage		399.91	362.60	318.09	319.94	307.80	357.08	386.07	479.83	615.70	770.83	1,387.55	1,549.35	1,566.43	1,328.73	37,022.20	—	—	—	—	267.63

December 31, 2024 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $1,155,747K ÷ $2,890K
= 399.91

The interest coverage ratio for Taylor Morn Home fluctuated significantly over the years, ranging from a high of 37,022.20 in June 2021 to a low of 307.80 in December 2023. The interest coverage ratio measures a company's ability to meet its interest payments on outstanding debt, with a higher ratio indicating a stronger ability to cover interest expenses.

From the data provided, it is evident that Taylor Morn Home experienced a substantial increase in its interest coverage ratio from 2021 to 2022, suggesting an improvement in the company's ability to service its debt obligations. However, the ratio saw a decline in the following periods, indicating potential challenges in meeting interest payments compared to the peak in 2022.

Overall, the trend in Taylor Morn Home's interest coverage ratio highlights fluctuations in the company's financial health and its capacity to manage its interest expenses. Monitoring this ratio over time can provide insights into the company's financial stability and its ability to handle debt obligations efficiently.