Tyler Technologies Inc (TYL)
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 | 299,526 | 218,537 | 214,249 | 180,735 | 172,926 |
| Interest expense | US$ in thousands | 5,931 | 23,629 | 28,379 | 23,298 | 1,013 |
| Interest coverage | 50.50 | 9.25 | 7.55 | 7.76 | 170.71 |
December 31, 2024 calculation
Interest coverage = EBIT ÷ Interest expense
= $299,526K ÷ $5,931K
= 50.50
Interest coverage measures a company's ability to pay interest expenses on its outstanding debt. Looking at the data provided for Tyler Technologies Inc, we observe a significant decrease in the interest coverage ratio from 170.71 in 2020 to 7.76 in 2021. This sharp decline suggests that the company's ability to cover its interest payments has weakened substantially year over year.
Subsequently, in 2022 and 2023, Tyler Technologies Inc continues to have relatively low interest coverage ratios of 7.55 and 9.25, indicating persistent challenges in meeting its interest obligations comfortably. However, there is a notable improvement in the interest coverage ratio in 2024, jumping to 50.50, signaling a significant enhancement in the company's capacity to service its debt.
Overall, the fluctuating trend in Tyler Technologies Inc's interest coverage ratios implies varying levels of financial resilience and solvency over the years, with the company facing a particularly challenging period in 2021 but showcasing signs of recovery and improved financial health in subsequent years.
Peer comparison
Dec 31, 2024