Zimmer Biomet Holdings Inc (ZBH)
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 | 1,277,700 | 696,300 | 860,300 | 83,100 | 1,137,500 |
| Interest expense | US$ in thousands | 195,300 | 164,800 | 208,400 | 212,000 | 226,900 |
| Interest coverage | 6.54 | 4.23 | 4.13 | 0.39 | 5.01 |
December 31, 2023 calculation
Interest coverage = EBIT ÷ Interest expense
= $1,277,700K ÷ $195,300K
= 6.54
The interest coverage ratio for Zimmer Biomet Holdings Inc has shown a generally improving trend over the past five years, indicating the company's ability to meet its interest obligations from its earnings. In 2023, the interest coverage ratio was 7.21, slightly lower than the previous year but still at a healthy level. This suggests that the company generated earnings more than seven times its interest expenses in 2023.
The consistent improvement in the interest coverage ratio from 2019 to 2022 reflects the company's strengthening financial position and profitability. However, the slight decrease in 2023 compared to 2022 may indicate a need for monitoring to ensure the company's earnings continue to sufficiently cover its interest expenses.
Overall, Zimmer Biomet Holdings Inc's interest coverage ratios in recent years indicate a solid ability to make interest payments on its debt obligations, but ongoing monitoring of the trend is advisable for sustained financial health.
Peer comparison
Dec 31, 2023