TechTarget, Inc. Common Stock (TTGT)
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 | — | -2 | 57,554 | 34,354 | 22,821 |
| Interest expense | US$ in thousands | 17,740 | 12 | 861 | 23,275 | 317 |
| Interest coverage | 0.00 | -0.17 | 66.85 | 1.48 | 71.99 |
December 31, 2024 calculation
Interest coverage = EBIT ÷ Interest expense
= $—K ÷ $17,740K
= 0.00
TechTarget, Inc. experienced a significant decline in its interest coverage ratio over the period from December 31, 2020, to December 31, 2023, as shown in the data provided. The interest coverage ratio decreased from a healthy level of 71.99 in 2020 to a concerning level of -0.17 in 2023, indicating that the company's ability to cover its interest expenses with its earnings had deteriorated substantially.
The plummeting interest coverage ratio raises concerns about the company's financial health and its ability to meet its debt obligations. A negative interest coverage ratio suggests that the company's operating income is insufficient to cover its interest expenses, indicating a potentially high risk of default.
Investors and creditors closely monitor the interest coverage ratio as it serves as a crucial indicator of a company's financial stability and creditworthiness. TechTarget would need to take measures to improve its profitability or manage its debt levels to enhance its interest coverage and restore investor confidence in its financial resilience.
Peer comparison
Dec 31, 2024