Thermo Fisher Scientific Inc (TMO)
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 | 8,427,000 | 6,859,000 | 8,560,000 | 10,372,000 | 7,867,000 |
| Interest expense | US$ in thousands | 1,390,000 | 1,375,000 | 726,000 | 536,000 | 553,000 |
| Interest coverage | 6.06 | 4.99 | 11.79 | 19.35 | 14.23 |
December 31, 2024 calculation
Interest coverage = EBIT ÷ Interest expense
= $8,427,000K ÷ $1,390,000K
= 6.06
Thermo Fisher Scientific Inc's interest coverage has shown varying trends over the past few years. In December 31, 2020, the interest coverage ratio was 14.23, indicating that the company was comfortably able to cover its interest expenses. This ratio improved to 19.35 by December 31, 2021, demonstrating even stronger ability to meet interest obligations.
However, there was a notable decline in interest coverage to 11.79 by December 31, 2022, suggesting a reduction in the company's ability to cover interest expenses effectively. The trend continued to worsen in the following years, reaching 4.99 by December 31, 2023, and slightly recovering to 6.06 by December 31, 2024.
The decreasing trend in the interest coverage ratio from 2022 to 2024 raises concerns about the company's ability to generate sufficient earnings to cover its interest payments. It is important for stakeholders to monitor this ratio closely to ensure that Thermo Fisher Scientific Inc's financial health remains sustainable in the long term.
Peer comparison
Dec 31, 2024