Werner Enterprises Inc (WERN)

Interest coverage

		Dec 31, 2024	Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	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
Earnings before interest and tax (EBIT) (ttm)	US$ in thousands	73,792	82,806	93,369	112,203	136,230	174,172	200,133	218,807	256,167	270,543	302,033	343,844	323,188	319,955	294,675	250,513	225,859	206,667	193,553	194,323
Interest expense (ttm)	US$ in thousands	39,212	36,903	34,471	33,567	33,535	30,540	24,657	18,305	11,828	7,604	6,110	5,024	4,423	3,399	3,002	3,462	4,215	5,798	7,319	7,587
Interest coverage		1.88	2.24	2.71	3.34	4.06	5.70	8.12	11.95	21.66	35.58	49.43	68.44	73.07	94.13	98.16	72.36	53.58	35.64	26.45	25.61

December 31, 2024 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $73,792K ÷ $39,212K
= 1.88

The trend in Werner Enterprises Inc.'s interest coverage ratio over the years indicates a generally positive financial position in terms of its ability to cover interest payments on its debt obligations. The interest coverage ratio has demonstrated a consistent improvement from March 31, 2020, to June 30, 2021, reaching a peak of 98.16. This indicates the company's strong ability to handle its interest expenses comfortably from its operating income during this period.

However, from September 30, 2021, onwards, there has been a slight decline in the interest coverage ratio, dropping to 1.88 by December 31, 2024. This sharp decrease raises concerns about the company's capability to cover its interest payments with its operating income in the most recent periods.

Overall, while the company exhibited excellent interest coverage ratios in the earlier years of the analyzed period, there is a deteriorating trend in recent periods, suggesting potential financial challenges or a shift in the company's debt structure that could impact its ability to service its debt obligations in the future. It would be advisable for stakeholders to monitor this trend closely and for the company to take necessary steps to improve its interest coverage position.