Japan TobaccoJAPAF 78 Interest Coverage is 8.83 as of Mar. 2026, which is 4% below its 10-year median of 9.22. GuruFocus rates JAPAF with a GF Score™ of 78/100 and a GF Value™ of $33.10 (Modestly Overvalued). The stock has 7 warning signs investors should review. Among 35 Tobacco Products companies, Japan Tobacco ranks worse than 80% on this metric.
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. Japan Tobacco's
Operating Income
for the
three
months ended in Mar. 2026 was $1,906 Mil. Japan Tobacco's Interest Expense for the
three
months ended in Mar. 2026 was $-216 Mil.
Japan Tobacco's interest coverage for the quarter that ended in Mar. 2026 was 8.83.
The higher the ratio, the stronger the company's financial strength is.
The historical rank and industry rank for Japan Tobacco's Interest Coverage or its related term are showing as below:
JAPAF'
s Interest Coverage Range Over the Past 10 Years
Min: 1.9 Med: 9.22 Max: 27.03
Current: 4.8
JAPAF's Interest Coverage is ranked worse than 80% of 35
companies
in the Tobacco Products industry
Industry Median: 10.9
vs JAPAF: 4.80
Japan Tobacco (OTCPK:JAPAF) 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 .
Japan Tobacco Interest Coverage Related Terms
Japan Tobacco Interest Coverage Historical Data
* Premium members only.
The historical data trend for Japan Tobacco'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.
JAPAF vs PM, MO, TPB: Interest Coverage Comparison
For the Tobacco subindustry, Japan Tobacco'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.
Japan Tobacco Interest Coverage vs Tobacco Products Industry
For the Tobacco Products industry and Consumer Defensive sector, Japan Tobacco's Interest Coverage distribution charts can be found below:
* The bar in red indicates where Japan Tobacco's Interest Coverage falls into.
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:
* 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.
Japan Tobacco (JAPAF) has a Interest Coverage of 8.83 as of Mar. 2026. Interest Coverage measures a company's capability to pay interest expenses on its debt. View historical data on Japan Tobacco and its competitors. This is near median its historical median of 9.22. Over the past decade, Japan Tobacco's Interest Coverage has ranged from 1.90 to 27.03. According to the industry distribution chart, Japan Tobacco ranks #28 out of 35 companies in the Tobacco Products industry, placing it in the top 80%.
Is Japan Tobacco's Interest Coverage too high?
Japan Tobacco's current Interest Coverage of 8.83 is near median its 10-year median of 9.22. Over the past 10 years, this metric has ranged from a low of 1.90 to a high of 27.03. The Tobacco Products industry median Interest Coverage is 10.90. Japan Tobacco's value of 8.83 is 19% below this industry median. Based on the distribution chart, Japan Tobacco ranks #28 out of 35 companies in the Tobacco Products industry, which is in the bottom quartile relative to peers. Overall, Japan Tobacco has a GF Score™ of 78/100 and is considered Modestly Overvalued, reflecting its overall financial health beyond just this single metric.
How does Japan Tobacco's Interest Coverage compare to PM and MO?
According to the Tobacco Products industry distribution chart, Japan Tobacco ranks #28 out of 35 companies for Interest Coverage. This places Japan Tobacco in the lower half of its industry. The industry median Interest Coverage is 10.90. Japan Tobacco's value of 8.83 is 19% below this benchmark. Historically, Japan Tobacco's own Interest Coverage has ranged from 1.90 to 27.03 over the past decade. While the company's 10-year median is 9.22 vs. the industry median of 10.90, Japan Tobacco has consistently been below the industry average. 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 Tobacco Products company?
The median Interest Coverage among Tobacco Products companies is 10.90, based on 35 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. Japan Tobacco's current Interest Coverage of 8.83 is 19% 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 Japan Tobacco and its competitors. For the Tobacco Products industry, the median Interest Coverage is 10.90 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Japan Tobacco's current Interest Coverage is 8.83, which is near median its own 10-year median of 9.22. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Japan Tobacco stock overvalued right now?
Based on GuruFocus' analysis, Japan Tobacco (JAPAF) is currently considered Modestly Overvalued. The stock's GF Value™ is $33.10, compared to a current price of $37.74 — trading 14% above its estimated fair value. The current Interest Coverage is 8.83, which is near median its 10-year median of 9.22 and 19% below the Tobacco Products industry median of 10.90. Japan Tobacco's overall GF Score™ is 78/100 with 7 warning signs to review. 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 Japan Tobacco (JAPAF), the current Interest Coverage is 8.83 as of Mar. 2026. 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.
Is Japan Tobacco (JAPAF) Overvalued in 2026?
Based on GuruFocus' analysis, Japan Tobacco stock appears to be overvalued.
The current stock price of $37.74 is trading 14% above its estimated GF Value™ of $33.10.
GuruFocus considers Japan Tobacco to be Modestly Overvalued.
Key valuation signals for JAPAF:
Interest Coverage: 8.83 (near median its 10-year median of 9.22)
GF Value™: $33.10 vs. price of $37.74 (14% above fair value)
Industry Position: 19% below the Tobacco Products median (#28 of 35)
No single metric tells the full story. See the JAPAF stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Japan Tobacco primarily sells cigarettes and reduced-risk products, organized in three clusters consisting of Asia (which includes its home market and countries in Asia Pacific), Western Europe, and EMA (which includes Eastern Europe, the Middle East North Africa, Turkey, Americas, and duty-free). Its leading cigarette brands include Winston (non-US), Camel (non-US), Mevius, and LD. Its reduced-risk brands include Logic in vaping, Ploom in heated tobacco, and Nordic Spirit in nicotine pouches, though these generates less than 5% of tobacco sales.
78GF Score
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