WESCO International Inc (WCC)
Interest coverage
| 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 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 1,406,400 | 1,472,485 | 1,493,585 | 1,500,485 | 1,438,085 | 1,276,584 | 1,104,450 | 952,622 | 801,873 | 674,352 | 622,981 | 419,379 | 347,041 | 338,086 | 253,724 | 336,404 | 346,217 | 352,908 | 356,692 | 349,925 |
| Interest expense (ttm) | US$ in thousands | 389,300 | 379,565 | 356,122 | 325,800 | 294,420 | 267,545 | 262,208 | 261,320 | 268,073 | 281,993 | 286,813 | 279,806 | 225,905 | 168,168 | 111,187 | 68,256 | 69,253 | 69,573 | 69,531 | 69,220 |
| Interest coverage | 3.61 | 3.88 | 4.19 | 4.61 | 4.88 | 4.77 | 4.21 | 3.65 | 2.99 | 2.39 | 2.17 | 1.50 | 1.54 | 2.01 | 2.28 | 4.93 | 5.00 | 5.07 | 5.13 | 5.06 |
December 31, 2023 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $1,406,400K ÷ $389,300K
= 3.61
Interest coverage ratio is a key financial metric that indicates a company's ability to meet its interest obligations on outstanding debt. It is calculated by dividing earnings before interest and taxes (EBIT) by the interest expense. A higher interest coverage ratio indicates a company's strong ability to cover its interest payments from its operating earnings.
The interest coverage ratio for Wesco International, Inc. has shown a generally positive trend over the last eight quarters, increasing from 3.65 in Q1 2022 to 4.61 in Q1 2023. This implies that the company's earnings are consistently sufficient to cover its interest expenses.
The highest interest coverage ratio was observed in Q4 2022 at 4.88, indicating a peak in the company's ability to pay its interest obligations. On the other hand, the lowest interest coverage ratio was 3.61 in Q4 2023, suggesting a slight decrease in this capability.
Overall, Wesco International, Inc.'s interest coverage ratios demonstrate a stable and healthy financial position, with the company consistently generating enough earnings to comfortably meet its interest payments. This indicates good financial health and lower risk of default on its debt obligations.
Peer comparison
Dec 31, 2023