Textron Inc (TXT)
Interest coverage
| Dec 31, 2024 | Sep 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | -2,866,000 | -2,115,000 | -2,059,000 | -2,028,000 | -1,820,000 | -1,279,000 | -795,000 | -206,000 | 1,134,000 | 1,090,000 | 1,049,000 | 1,014,000 | 990,000 | 898,000 | 569,000 | 448,000 | 444,000 | 570,000 | 968,000 | 1,113,000 |
| Interest expense (ttm) | US$ in thousands | 91,000 | 84,000 | 77,000 | 77,000 | 69,000 | 81,000 | 94,000 | 107,000 | 129,000 | 131,000 | 135,000 | 142,000 | 150,000 | 160,000 | 166,000 | 166,000 | 167,000 | 168,000 | 169,000 | 171,000 |
| Interest coverage | -31.49 | -25.18 | -26.74 | -26.34 | -26.38 | -15.79 | -8.46 | -1.93 | 8.79 | 8.32 | 7.77 | 7.14 | 6.60 | 5.61 | 3.43 | 2.70 | 2.66 | 3.39 | 5.73 | 6.51 |
December 31, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $-2,866,000K ÷ $91,000K
= -31.49
Based on the provided data, Textron Inc's interest coverage ratio has shown significant fluctuations over the years. The interest coverage ratio, which indicates the company's ability to meet its interest obligations, decreased from 6.51 as of December 31, 2019, to a low of -31.49 as of December 31, 2024.
The decreasing trend in the interest coverage ratio from 2020 to 2024 suggests that Textron Inc's ability to cover its interest payments with its operating income deteriorated over this period. A declining interest coverage ratio can indicate potential financial distress if not addressed timely.
It is crucial for investors and stakeholders to closely monitor Textron Inc's interest coverage ratio, as sustained low or negative values could signal potential liquidity issues and constraints in meeting debt obligations. Management should focus on improving the company's profitability and operational efficiency to enhance its ability to service its debt and maintain a healthy financial position.
Peer comparison
Dec 31, 2024