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Spirit Airlines Inc (NAS:SAVE)
Interest Coverage
10,000.00 (As of Dec. 2013)

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. Spirit Airlines Inc's Operating Income for the three months ended in Dec. 2013 was $68 Mil. Spirit Airlines Inc's Interest Expense for the three months ended in Dec. 2013 was $0 Mil. Spirit Airlines Inc's interest coverage for the quarter that ended in Dec. 2013 was 10,000.00. The higher the ratio, the stronger the company’s financial strength is.

Good Sign:

Spirit Airlines Inc has no debt.

SAVE' s 10-Year Interest Coverage Range
Min: 0.46   Max: 9999.99
Current: No Debt

0.46
9999.99

During the past 6 years, the highest interest coverage of Spirit Airlines Inc was 9999.99. The lowest was 0.46. And the median was 4.52.

SAVE's Interest Coverageis ranked higher than
98% of the 91 Companies
in the Global Airlines industry.

( Industry Median: 3.71 vs. SAVE: No Debt )

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

Spirit Airlines 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

Spirit Airlines Inc had no debt.

Spirit Airlines Inc's Interest Coverage for the fiscal year that ended in Dec. 2013 is calculated as

Here, for the fiscal year that ended in Dec. 2013, Spirit Airlines Inc's Interest Expense was $0 Mil. Its Operating Income was $282 Mil. And its Long-Term Debt was $0 Mil.

Spirit Airlines Inc had no debt.

Spirit Airlines Inc's Interest Coverage for the quarter that ended in Dec. 2013 is calculated as

Here, for the three months ended in Dec. 2013, Spirit Airlines Inc's Interest Expense was $0 Mil. Its Operating Income was $68 Mil. And its Long-Term Debt was $0 Mil.

Spirit Airlines 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.

Spirit Airlines Inc Annual Data

Dec08Dec09Dec10Dec11Dec12Dec13
interest_coverage At LossAt LossAt LossAt Loss0.462.431.416.60No DebtNo Debt

Spirit Airlines Inc Quarterly Data

Sep11Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13
interest_coverage No Debt19,011.50No DebtNo DebtNo DebtNo DebtNo DebtNo DebtNo DebtNo Debt
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