TripAdvisor Inc (TRIP)
Interest coverage
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 169,000 | 111,000 | -140,000 | -334,000 | 201,000 |
| Interest expense | US$ in thousands | 44,000 | 44,000 | 45,000 | 35,000 | 7,000 |
| Interest coverage | 3.84 | 2.52 | -3.11 | -9.54 | 28.71 |
December 31, 2023 calculation
Interest coverage = EBIT ÷ Interest expense
= $169,000K ÷ $44,000K
= 3.84
The interest coverage ratio for TripAdvisor Inc. has fluctuated significantly over the past five years, indicating varying levels of ability to cover interest expenses with operating income.
In 2023 and 2019, specific data points for interest coverage were not provided. However, in 2022, the interest coverage ratio stood at 3.41 times, demonstrating that the company generated sufficient operating income to cover its interest expenses comfortably.
On the other hand, the ratios of -3.05 in 2021 and -9.00 in 2020 are concerning as they indicate that TripAdvisor Inc. did not generate enough operating income to cover its interest expenses during those years. A negative interest coverage ratio suggests financial distress, as the company's operating income was insufficient to cover interest payments.
Overall, based on the information provided, it is evident that TripAdvisor Inc. experienced a mix of positive and negative trends in its interest coverage ratio over the past five years, highlighting the importance of monitoring the company's ability to meet its interest obligations with operating income.
Peer comparison
Dec 31, 2023