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Dollar Tree Stores Inc (NAS:DLTR)
Interest Coverage
0.00 (As of Oct. 2014)

Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company’s Operating Income (EBIT) by its Interest Expense. Dollar Tree Stores Inc's Operating Income for the three months ended in Oct. 2014 was $220 Mil. Dollar Tree Stores Inc's Interest Expense for the three months ended in Oct. 2014 was $0 Mil. Dollar Tree Stores Inc's interest coverage for the quarter that ended in Oct. 2014 was 0.00. The higher the ratio, the stronger the company’s financial strength is.

DLTR' s 10-Year Interest Coverage Range
Min: 11.29   Max: 328.61
Current: 63.01

11.29
328.61

During the past 13 years, the highest interest coverage of Dollar Tree Stores Inc was 328.61. The lowest was 11.29. And the median was 31.77.

DLTR's Interest Coverageis ranked higher than
82% of the 434 Companies
in the Global Discount Stores industry.

( Industry Median: 12.83 vs. DLTR: 63.01 )

Definition

Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company’s Operating Income (EBIT) by its Interest Expense:

If Interest Expense is negative and Operating Income is positive, then

Interest Coverage=-1*Operating Income/Interest Expense

Else if Interest Expense is negative and Operating Income is negative, then

Dollar Tree Stores Inc did not have earnings to cover the interest expense.

Else if Interest Expense is 0 and Long-Term Debt is 0, or Interest Expense is positive, then

Dollar Tree Stores Inc had no debt.

Dollar Tree Stores Inc's Interest Coverage for the fiscal year that ended in Jan. 2014 is calculated as

Here, for the fiscal year that ended in Jan. 2014, Dollar Tree Stores Inc's Interest Expense was $-15 Mil. Its Operating Income was $970 Mil. And its Long-Term Debt was $757 Mil.

Interest Coverage=-1*Operating Income (A: Jan. 2014 )/Interest Expense (A: Jan. 2014 )
=-1*970.3/-15.4
=63.01

Dollar Tree Stores Inc's Interest Coverage for the quarter that ended in Oct. 2014 is calculated as

Here, for the three months ended in Oct. 2014, Dollar Tree Stores Inc's Interest Expense was $0 Mil. Its Operating Income was $220 Mil. And its Long-Term Debt was $757 Mil.

Dollar Tree Stores Inc had no debt.

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

The higher the ratio, the stronger the company’s financial strength is.


Explanation

Ben Graham requires that a company has a minimum interest coverage of 5 with the companies he invested. If the interest coverage is less than 2, the company is burdened by debt. Any business slow or recession may drag the company into a situation where it cannot pay the interest on its debt.

Interest Coverage is an important factor when GuruFocus ranks a company’s overage financial strength.


Related Terms

Operating Income, Interest Expense, Financial Strength


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

Dollar Tree Stores Inc Annual Data

Jan05Jan06Jan07Jan08Jan09Jan10Jan11Jan12Jan13Jan14
interest_coverage 31.7720.1718.8419.2039.3398.62112.50269.69328.6163.01

Dollar Tree Stores Inc Quarterly Data

Jul12Oct12Jan13Apr13Jul13Oct13Jan14Apr14Jul14Oct14
interest_coverage At LossAt Loss908.75At Loss287.57At Loss39.12At Loss24.40At Loss
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