TripAdvisor Inc (TRIP)
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 | 133,000 | 169,000 | 111,000 | -140,000 | -334,000 |
| Interest expense | US$ in thousands | 46,000 | 44,000 | 44,000 | 45,000 | 35,000 |
| Interest coverage | 2.89 | 3.84 | 2.52 | -3.11 | -9.54 |
December 31, 2024 calculation
Interest coverage = EBIT ÷ Interest expense
= $133,000K ÷ $46,000K
= 2.89
The interest coverage ratio for TripAdvisor Inc has shown a fluctuating trend over the years. In December 2020 and December 2021, the company's interest coverage ratios were negative, indicating that TripAdvisor's earnings were insufficient to cover its interest expenses during those periods.
However, there has been an improvement in the company's financial position in the subsequent years. By December 2022, the interest coverage ratio had turned positive at 2.52, suggesting that the company's operating income was now more adequate to cover its interest obligations. This positive trend continued in December 2023 and December 2024, with the interest coverage ratios increasing to 3.84 and 2.89 respectively.
Overall, while the company faced challenges in meeting its interest expenses in the past, there has been a positive development in recent years with an improvement in the interest coverage ratio. Moving forward, it will be important for TripAdvisor Inc to sustain this positive trend in order to ensure its financial stability and ability to meet its debt obligations.
Peer comparison
Dec 31, 2024