DCEL (Digicel Group) Interest Coverage: 1.58 (As of Mar. 2015)


What is Digicel Group Interest Coverage?

Digicel Group DCEL Interest Coverage is 1.58 as of Mar. 2015.

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 by its Interest Expense. Digicel Group's Operating Income for the six months ended in Mar. 2015 was $707.81 Mil. Digicel Group's Interest Expense for the six months ended in Mar. 2015 was $-447.99 Mil. Digicel Group's interest coverage for the quarter that ended in Mar. 2015 was 1.58. The higher the ratio, the stronger the company's financial strength is.

The historical rank and industry rank for Digicel Group's Interest Coverage or its related term are showing as below:


DCEL's Interest Coverage is not ranked *
in the Telecommunication Services industry.
Industry Median: 4.715
* Ranked among companies with meaningful Interest Coverage only.

Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.

Digicel Group  (NYSE:DCEL) Interest Coverage 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 .

Digicel Group Interest Coverage Related Terms

Digicel Group Interest Coverage Historical Data

* Premium members only.

The historical data trend for Digicel Group's Interest Coverage can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

Note: For Interest Coverage, "No debt" indicates no long-term debt. An indication of "No Debt" does not necessarily mean that the company has no long-term debt obligations; it could be due to missing data in the quarterly or annual report. Use caution when interpreting this information.

Digicel Group Interest Coverage Chart

Digicel Group Annual Data
Trend Mar13 Mar14 Mar15
Interest Coverage
1.83 1.86 1.58

Digicel Group Semi-Annual Data
Mar13 Mar14 Mar15
Interest Coverage 1.83 1.86 1.58

DCEL vs DIRV, FULO, TOWTF: Interest Coverage Comparison

For the Telecom Services subindustry, Digicel Group's Interest Coverage, along with its competitors' market caps and Interest Coverage data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

Digicel Group Interest Coverage vs Telecommunication Services Industry

For the Telecommunication Services industry and Communication Services sector, Digicel Group's Interest Coverage distribution charts can be found below:

* The bar in red indicates where Digicel Group's Interest Coverage falls into.


Digicel Group Interest Coverage Calculation

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

The company did not have earnings to cover the interest expense.

Else if Interest Expense is 0 and Long-Term Debt & Capital Lease Obligation is 0, then

The company had no debt (1).


Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.

Digicel Group's Interest Coverage for the fiscal year that ended in Mar. 2015 is calculated as

Here, for the fiscal year that ended in Mar. 2015, Digicel Group's Interest Expense was $-447.99 Mil. Its Operating Income was $707.81 Mil. And its Long-Term Debt & Capital Lease Obligation was $6,305.51 Mil.

Interest Coverage=-1* Operating Income (A: Mar. 2015 )/Interest Expense (A: Mar. 2015 )
=-1*707.806/-447.988
=1.58

Digicel Group's Interest Coverage for the quarter that ended in Mar. 2015 is calculated as

Here, for the six months ended in Mar. 2015, Digicel Group's Interest Expense was $-447.99 Mil. Its Operating Income was $707.81 Mil. And its Long-Term Debt & Capital Lease Obligation was $6,305.51 Mil.

Interest Coverage=-1* Operating Income (Q: Mar. 2015 )/Interest Expense (Q: Mar. 2015 )
=-1*707.806/-447.988
=1.58

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

The higher the ratio, the stronger the company's Financial Strength is.

Frequently Asked Questions Learn more about Interest Coverage →
What does a Interest Coverage of 1.58 mean?
Digicel Group (DCEL) has a Interest Coverage of 1.58 as of Mar. 2015. Interest Coverage measures a company's capability to pay interest expenses on its debt. View historical data on Digicel Group and its competitors.
Is Digicel Group's Interest Coverage too high?
Digicel Group's current Interest Coverage is 1.58. The Telecommunication Services industry median Interest Coverage is 4.72. Digicel Group's value of 1.58 is 66.5% below this industry median.
How does Digicel Group's Interest Coverage compare to DIRV and FULO?
Digicel Group's Interest Coverage of 1.58 can be compared against companies in the Telecommunication Services industry. The industry median Interest Coverage is 4.72. Digicel Group's value of 1.58 is 66.5% below this benchmark. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Interest Coverage for a Telecommunication Services company?
The median Interest Coverage among Telecommunication Services companies is 4.72, based on 286 companies in the industry. Companies in the top quartile (top 25%) have a Interest Coverage significantly above this median, while those in the bottom quartile fall well below. However, Interest Coverage should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Digicel Group's current Interest Coverage of 1.58 is 66.5% below the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Interest Coverage mean?
A high Interest Coverage can signal that a stock is expensive relative to its fundamentals. Interest Coverage measures a company's capability to pay interest expenses on its debt. View historical data on Digicel Group and its competitors. For the Telecommunication Services industry, the median Interest Coverage is 4.72 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Digicel Group's current Interest Coverage is 1.58. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Digicel Group stock overvalued right now?
Digicel Group (DCEL) has a current Interest Coverage of 1.58. The current Interest Coverage is 1.58 and 66.5% below the Telecommunication Services industry median of 4.72. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Interest Coverage calculated?
Interest Coverage is calculated from a company's financial statements. For Digicel Group (DCEL), the current Interest Coverage is 1.58 as of Mar. 2015. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.

Digicel Group Business Description

Digicel Group Ltd was incorporated under the laws of Bermuda on February 5, 2007. The Company is a provider of communications services in the Caribbean and South Pacific regions. It provides a comprehensive range of mobile communications, business solutions, cable TV & broadband and other related products and services to retail, corporate (including small and medium-sized enterprises) and government customers. Its business is currently organized into nine reporting segments: Jamaica, Trinidad and Tobago, French West Indies, Haiti, El Salvador, Eastern Caribbean markets consisting of its operations in St. Lucia, Grenada and St. Vincent and the Grenadines, Guyana, Papua New Guinea and Other locations, consisting of its operations in all of its other markets. It has customer reach through 1,034 retail locations (including 667 exclusive stores) and a dealer and distributor network with approximately 183,000 recharge locations. It offers its services on both a prepaid and post-paid basis and market to retail and business customers. It caters to its retail customers through Digicel's dealer channel and to its corporate clients via a business channel. Its distribution channel is comprised of the four distinct categories: Vendor Stores, Third-Party Dealers, Prepaid Card Outlets, and Diaspora. The Company's Mobile and Cable TV & Broadband operations are subject to regulation in each of the markets in which it operates.