Toro Co (TTC)
Interest coverage
| Oct 31, 2024 | Aug 2, 2024 | May 3, 2024 | Feb 2, 2024 | Oct 31, 2023 | Aug 4, 2023 | May 5, 2023 | Feb 3, 2023 | Oct 31, 2022 | Jul 29, 2022 | Apr 29, 2022 | Jan 28, 2022 | Oct 31, 2021 | Jul 30, 2021 | Apr 30, 2021 | Jan 29, 2021 | Oct 31, 2020 | Jul 31, 2020 | May 1, 2020 | Jan 31, 2020 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 533,300 | 518,849 | 351,677 | 382,873 | 430,700 | 486,563 | 668,683 | 620,464 | 575,663 | 499,411 | 458,302 | 468,441 | 518,280 | 540,724 | 538,082 | 487,396 | 440,226 | 395,715 | 356,657 | 370,501 |
| Interest expense (ttm) | US$ in thousands | 61,900 | 62,278 | 62,765 | 60,765 | 58,665 | 55,306 | 49,501 | 42,825 | 35,738 | 31,216 | 29,050 | 28,150 | 28,659 | 29,699 | 30,987 | 32,522 | 33,156 | 33,514 | 34,214 | 32,249 |
| Interest coverage | 8.62 | 8.33 | 5.60 | 6.30 | 7.34 | 8.80 | 13.51 | 14.49 | 16.11 | 16.00 | 15.78 | 16.64 | 18.08 | 18.21 | 17.36 | 14.99 | 13.28 | 11.81 | 10.42 | 11.49 |
October 31, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $533,300K ÷ $61,900K
= 8.62
The interest coverage ratio for Toro Co has shown variability over the past few periods. The ratio indicates the company's ability to meet its interest obligations from its operating income. A higher ratio suggests that the company is more capable of servicing its debt with its earnings.
Toro Co's interest coverage ratio ranged from 5.60 to 18.21 over the analyzed periods. The lower ratios in some periods indicate a relatively lower ability to cover interest payments from operating income, which may raise concerns about the company's financial health and its ability to manage its debt obligations.
However, the company's interest coverage ratio generally appears healthy, with several periods showing ratios above 10, indicating a comfortable cushion between earnings and interest payments. This suggests that Toro Co has the ability to easily cover its interest expenses, which is a positive sign for investors and lenders.
Overall, Toro Co's interest coverage ratio demonstrates a fluctuating but generally satisfactory ability to meet its interest obligations from operating income, indicating a moderate level of financial strength in managing its debt.