Valmont Industries Inc (VMI)
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 | 524,584 | 297,778 | 433,249 | 286,785 | 225,953 |
| Interest expense | US$ in thousands | 58,722 | 56,808 | 47,534 | 42,612 | 41,075 |
| Interest coverage | 8.93 | 5.24 | 9.11 | 6.73 | 5.50 |
December 31, 2024 calculation
Interest coverage = EBIT ÷ Interest expense
= $524,584K ÷ $58,722K
= 8.93
The interest coverage ratio of Valmont Industries Inc has shown a positive trend over the past five years. Starting at 5.50 in December 31, 2020, the ratio has gradually improved to reach 6.73 in December 31, 2021, further increasing to 9.11 in December 31, 2022. However, there was a slight decline in the ratio to 5.24 in December 31, 2023, before rebounding to 8.93 in December 31, 2024.
The consistently positive interest coverage ratio indicates that Valmont Industries Inc has been able to comfortably cover its interest expenses with its operating earnings over the years. This implies lower financial risk for the company as it suggests that it has sufficient earnings to meet its interest payment obligations. However, the fluctuation in the ratio in some years may warrant further investigation into the company's financial performance to understand the underlying factors affecting its interest coverage.
Peer comparison
Dec 31, 2024