Woodward Inc (WWD)
Interest coverage
| 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 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 501,930 | 496,698 | 480,999 | 401,931 | 323,666 | 281,168 | 222,075 | 231,282 | 234,443 | 236,925 | 245,200 | 269,643 | 280,081 | 287,748 | 274,406 | 303,625 | 317,692 | 326,725 | 376,084 | 361,777 |
| Interest expense (ttm) | US$ in thousands | 47,959 | 46,218 | 46,877 | 48,192 | 47,898 | 45,671 | 42,029 | 37,381 | 34,545 | 33,766 | 33,630 | 33,682 | 34,282 | 34,861 | 35,201 | 35,708 | 35,811 | 36,347 | 38,408 | 41,132 |
| Interest coverage | 10.47 | 10.75 | 10.26 | 8.34 | 6.76 | 6.16 | 5.28 | 6.19 | 6.79 | 7.02 | 7.29 | 8.01 | 8.17 | 8.25 | 7.80 | 8.50 | 8.87 | 8.99 | 9.79 | 8.80 |
September 30, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $501,930K ÷ $47,959K
= 10.47
Woodward Inc's interest coverage ratio has been consistently strong over the past few quarters, indicating the company's ability to comfortably meet its interest obligations. The interest coverage ratio has been consistently above 5 in recent quarters, with the most recent figure for September 30, 2024 standing at 10.47. This suggests that the company's earnings before interest and taxes (EBIT) are more than ten times its interest expenses.
The trend in interest coverage shows a generally positive trajectory, with fluctuations within a relatively healthy range. The ratio peaked at 10.75 in June 30, 2024, and has remained above 6 since at least the beginning of 2022. This indicates that Woodward Inc has been effectively managing its interest payments and generating sufficient earnings to cover its financial obligations.
Overall, the consistent and strong interest coverage ratio of Woodward Inc reflects a solid financial position and indicates a low risk of default on its debt obligations in the near term. Investors and creditors may view this positively as it demonstrates the company's ability to service its debt comfortably.