Ulta Beauty Inc (ULTA)

Interest coverage

		Feb 3, 2024	Oct 28, 2023	Jul 29, 2023	Apr 29, 2023	Jan 28, 2023	Oct 29, 2022	Jul 30, 2022	Apr 30, 2022	Jan 29, 2022	Oct 30, 2021	Jul 31, 2021	May 1, 2021	Jan 30, 2021	Oct 31, 2020	Aug 1, 2020	May 2, 2020	Feb 1, 2020	Nov 2, 2019	Aug 3, 2019	May 4, 2019
Earnings before interest and tax (EBIT) (ttm)	US$ in thousands	1,678,029	1,608,557	1,643,186	1,642,972	1,638,610	1,566,614	1,488,997	1,429,876	1,297,492	1,146,142	963,180	643,628	236,820	300,304	366,807	562,070	901,094	894,548	895,981	881,778
Interest expense (ttm)	US$ in thousands	2,899	7,277	8,126	12,683	5,736	1,825	1,389	1,706	1,663	1,659	2,629	4,821	5,735	5,711	5,228	4,282	5,056	5,892	6,310	5,782
Interest coverage		578.83	221.05	202.21	129.54	285.67	858.42	1,071.99	838.15	780.21	690.86	366.37	133.51	41.29	52.58	70.16	131.26	178.22	151.82	141.99	152.50

February 3, 2024 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $1,678,029K ÷ $2,899K
= 578.83

Ulta Beauty Inc's interest coverage ratio has exhibited significant fluctuations over the reported periods. The interest coverage ratio measures a company's ability to meet its interest obligations with its operating income.

In February 2024, Ulta Beauty Inc's interest coverage was exceptionally high at 578.83, indicating the company's operating income was significantly more than its interest expenses, reflecting strong financial health. This was a notable improvement compared to the preceding period in October 2023, where the interest coverage was 221.05.

The trend over the past several periods has been relatively volatile, with fluctuations in the interest coverage ratio. For instance, in July 2022, the interest coverage ratio peaked at 1,071.99, signifying a robust ability to cover interest expenses.

However, there have been periods of lower interest coverage ratios, such as in January 2021 when the ratio dropped to 41.29. This could potentially indicate a strain on Ulta Beauty Inc's ability to meet its interest obligations from its operating income during that period.

Overall, given the fluctuations observed in Ulta Beauty Inc's interest coverage ratio, it is essential to monitor future trends to assess the company's ability to manage its interest expenses effectively and sustain its financial stability.