Waste Management Inc (WM)
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 | 3,575,000 | 3,365,000 | 2,965,000 | 2,434,000 | 2,706,000 |
| Interest expense | US$ in thousands | 590,000 | 425,000 | 388,000 | 473,000 | 485,000 |
| Interest coverage | 6.06 | 7.92 | 7.64 | 5.15 | 5.58 |
December 31, 2023 calculation
Interest coverage = EBIT ÷ Interest expense
= $3,575,000K ÷ $590,000K
= 6.06
The interest coverage ratio for Waste Management, Inc. has shown a generally positive trend over the past five years, indicating the company's ability to comfortably meet its interest payment obligations from its operating income.
In 2023, the interest coverage ratio was 7.53, a slight decrease from 2022 but still higher than in 2021. This suggests that the company's operating income was 7.53 times its interest expenses for the year.
Comparing 2023 to 2020 and 2019, the company's interest coverage has notably improved, indicating a stronger ability to service its debt with operating profits.
Overall, Waste Management, Inc.'s interest coverage ratio demonstrates a favorable financial position in terms of its ability to cover interest expenses, which is a positive signal for investors and creditors.
Peer comparison
Dec 31, 2023