Upbound Group Inc. (UPBD)
Interest coverage
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 166,285 | 149,179 | 265,178 | 238,104 | 254,814 |
| Interest expense | US$ in thousands | 113,418 | 87,708 | 70,874 | 15,325 | 31,031 |
| Interest coverage | 1.47 | 1.70 | 3.74 | 15.54 | 8.21 |
December 31, 2023 calculation
Interest coverage = EBIT ÷ Interest expense
= $166,285K ÷ $113,418K
= 1.47
The interest coverage ratio measures Upbound Group Inc.'s ability to meet its interest payments with its operating income. A higher ratio indicates a greater capacity to service its debt obligations.
The trend of Upbound Group Inc.'s interest coverage over the past five years shows some fluctuations. In 2023, the interest coverage ratio decreased to 1.47 from 1.70 in 2022, indicating a slight decline in the company's ability to cover its interest payments with operating income.
This decline follows a general downward trend in the ratio from 2019 to 2023, except for a notable spike in 2020 when the ratio was at its highest point of 15.54. This surge in 2020 suggests a significant improvement in Upbound Group Inc.'s ability to cover interest expenses with operating income, potentially due to increased profitability or lower interest costs.
Overall, Upbound Group Inc.'s interest coverage has shown variability in recent years, and further analysis of the company's financial performance and debt management strategies may be necessary to understand the factors contributing to these fluctuations.
Peer comparison
Dec 31, 2023