Zebra Technologies Corporation (ZBRA)
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 | 481,000 | 529,000 | 973,000 | 636,000 | 687,000 |
| Interest expense | US$ in thousands | 142,000 | 23,000 | 5,000 | 76,000 | 89,000 |
| Interest coverage | 3.39 | 23.00 | 194.60 | 8.37 | 7.72 |
December 31, 2023 calculation
Interest coverage = EBIT ÷ Interest expense
= $481,000K ÷ $142,000K
= 3.39
The interest coverage ratio for Zebra Technologies Corp. has shown some fluctuations over the past five years. In 2019, the interest coverage ratio was 8.13, indicating that the company earned 8.13 times the amount needed to cover its interest expenses for the year. This implies a healthy level of interest coverage.
In 2020, the interest coverage ratio slightly increased to 9.01, a positive sign that the company's ability to cover interest payments improved further. However, there was a significant drop in 2021, with the interest coverage ratio reaching 202.20, suggesting an unusually high amount of earnings relative to interest expenses for that year.
The data for 2022 is missing, making it challenging to assess the trend in that particular year. Finally, in 2023, the interest coverage ratio dropped to 4.40, indicating a decrease in the company's ability to cover its interest expenses compared to the previous years.
Overall, the trend in Zebra Technologies Corp.'s interest coverage over the past five years shows fluctuations, with some years demonstrating strong coverage while others show a decline. It is essential for the company to monitor and manage its interest coverage ratio effectively to ensure a sustainable financial position.
Peer comparison
Dec 31, 2023