The Wendy’s Co (WEN)
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 | 403,479 | 395,992 | 388,116 | 375,611 | 365,824 | 352,915 | 332,236 | 343,711 | 349,763 | 351,285 | 352,448 | 303,975 | 270,532 | 253,429 | 253,141 | 268,294 | 287,452 | 274,938 | 722,239 | 718,969 |
| Interest expense (ttm) | US$ in thousands | 124,061 | 125,711 | 126,670 | 127,659 | 122,319 | 116,601 | 110,685 | 106,764 | 109,185 | 114,031 | 117,117 | 117,998 | 117,737 | 115,724 | 114,568 | 115,414 | 115,971 | 116,622 | 118,317 | 118,522 |
| Interest coverage | 3.25 | 3.15 | 3.06 | 2.94 | 2.99 | 3.03 | 3.00 | 3.22 | 3.20 | 3.08 | 3.01 | 2.58 | 2.30 | 2.19 | 2.21 | 2.32 | 2.48 | 2.36 | 6.10 | 6.07 |
December 31, 2023 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $403,479K ÷ $124,061K
= 3.25
Wendy's Co has consistently maintained a healthy interest coverage ratio over the past eight quarters, ranging from 2.93 to 3.16. The interest coverage ratio indicates the company's ability to meet its interest obligations with its operating income. With values above 1, Wendy's Co has demonstrated that it is generating enough earnings to cover its interest expenses comfortably. The stability and upward trend in the interest coverage ratio suggest that the company has a strong financial position and is not heavily burdened by debt servicing costs. Despite some slight fluctuations, the overall trend indicates that Wendy's Co has been effectively managing its interest payments relative to its operating income.
Peer comparison
Dec 31, 2023