Tesla Inc (TSLA)
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 | 7,076,000 | 10,152,000 | 13,879,000 | 6,589,000 | 1,761,000 |
| Interest expense | US$ in thousands | 350,000 | 156,000 | 191,000 | 371,000 | 748,000 |
| Interest coverage | 20.22 | 65.08 | 72.66 | 17.76 | 2.35 |
December 31, 2024 calculation
Interest coverage = EBIT ÷ Interest expense
= $7,076,000K ÷ $350,000K
= 20.22
Tesla Inc's interest coverage ratio has shown a significant improvement over the years, indicating strong capacity to meet its interest payment obligations.
In 2020, the interest coverage ratio was 2.35, which suggests that the company's operating income was able to cover its interest expenses 2.35 times over. This level could be considered somewhat weak, indicating a relatively limited ability to meet interest payments.
However, in subsequent years, Tesla's interest coverage ratio saw a substantial increase, reaching 17.76 in 2021, 72.66 in 2022, and maintaining strong levels at 65.08 in 2023 and 20.22 in 2024. These higher values signal a significant improvement in the company's financial health and its ability to comfortably cover interest expenses from its operating income.
Overall, Tesla Inc's interest coverage has shown a positive trend, reflecting improved financial stability and capacity to service its debt obligations.
Peer comparison
Dec 31, 2024