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Ross Stores Inc (NAS:ROST)
Interest Coverage
0.00 (As of Apr. 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. Ross Stores Inc's Operating Income for the three months ended in Apr. 2014 was $393 Mil. Ross Stores Inc's Interest Expense for the three months ended in Apr. 2014 was $0 Mil. Ross Stores Inc's interest coverage for the quarter that ended in Apr. 2014 was 0.00. The higher the ratio, the stronger the company’s financial strength is.

Good Sign:

Ben Graham prefers companies interest coverage is at least 5. Ross Stores Inc has enough cash to cover all of its debt. Its financial situation is stable.

ROST' s 10-Year Interest Coverage Range
Min: 27.7   Max: 9999.99
Current: 5308.55

27.7
9999.99

During the past 13 years, the highest interest coverage of Ross Stores Inc was 9999.99. The lowest was 27.70. And the median was 169.41.

ROST's Interest Coverageis ranked higher than
84% of the 736 Companies
in the Global Apparel Stores industry.

( Industry Median: 35.22 vs. ROST: 5308.55 )

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

Ross 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

Ross Stores Inc had no debt.

Ross 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, Ross Stores Inc's Interest Expense was $-0 Mil. Its Operating Income was $1,343 Mil. And its Long-Term Debt was $150 Mil.

Interest Coverage=-1*Operating Income (A: Jan. 2014 )/Interest Expense (A: Jan. 2014 )
=-1*1343.063/-0.253
=5,308.55

Ross Stores Inc's Interest Coverage for the quarter that ended in Apr. 2014 is calculated as

Here, for the three months ended in Apr. 2014, Ross Stores Inc's Interest Expense was $0 Mil. Its Operating Income was $393 Mil. And its Long-Term Debt was $150 Mil.

Ross 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.

Ross Stores Inc Annual Data

Jan05Jan06Jan07Jan08Jan09Jan10Jan11Jan12Jan13Jan14
interest_coverage 323.19No DebtAt Loss42.9759.6677.2584.7396.49169.415,308.55

Ross Stores Inc Quarterly Data

Jan12Apr12Jul12Oct12Jan13Apr13Jul13Oct13Jan14Apr14
interest_coverage 93.92152.29143.40155.66At LossAt LossAt LossAt LossAt LossAt Loss
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