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Alcatel-Lucent (XPAR:ALUNV) Interest Coverage : 0 (At Loss) (As of Jun. 2016)


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What is Alcatel-Lucent Interest Coverage?

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. Alcatel-Lucent's Operating Income for the three months ended in Jun. 2016 was €-1,563 Mil. Alcatel-Lucent's Interest Expense for the three months ended in Jun. 2016 was €32 Mil. did not have earnings to cover the interest expense. The higher the ratio, the stronger the company's financial strength is.

The historical rank and industry rank for Alcatel-Lucent's Interest Coverage or its related term are showing as below:


XPAR:ALUNV's Interest Coverage is not ranked *
in the Hardware industry.
Industry Median: 12.55
* 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.


Alcatel-Lucent Interest Coverage Historical Data

The historical data trend for Alcatel-Lucent'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.

* Premium members only.

Alcatel-Lucent Interest Coverage Chart

Alcatel-Lucent Annual Data
Trend Dec06 Dec07 Dec08 Dec09 Dec10 Dec11 Dec12 Dec13 Dec14 Dec15
Interest Coverage
Get a 7-Day Free Trial Premium Member Only Premium Member Only 0.33 - - 0.38 2.07

Alcatel-Lucent Quarterly Data
Jun11 Sep11 Dec11 Mar12 Jun12 Sep12 Dec12 Mar13 Jun13 Sep13 Dec13 Mar14 Jun14 Sep14 Dec14 Mar15 Jun15 Sep15 Dec15 Jun16
Interest Coverage Get a 7-Day Free Trial Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 2.93 0.42 - 9.87 -

Competitive Comparison of Alcatel-Lucent's Interest Coverage

For the Communication Equipment subindustry, Alcatel-Lucent'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.


Alcatel-Lucent's Interest Coverage Distribution in the Hardware Industry

For the Hardware industry and Technology sector, Alcatel-Lucent's Interest Coverage distribution charts can be found below:

* The bar in red indicates where Alcatel-Lucent's Interest Coverage falls into.



Alcatel-Lucent 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.

Alcatel-Lucent's Interest Coverage for the fiscal year that ended in Dec. 2015 is calculated as

Here, for the fiscal year that ended in Dec. 2015, Alcatel-Lucent's Interest Expense was €-327 Mil. Its Operating Income was €678 Mil. And its Long-Term Debt & Capital Lease Obligation was €4,632 Mil.

Interest Coverage=-1* Operating Income (A: Dec. 2015 )/Interest Expense (A: Dec. 2015 )
=-1*678/-327
=2.07

Alcatel-Lucent's Interest Coverage for the quarter that ended in Jun. 2016 is calculated as

Here, for the three months ended in Jun. 2016, Alcatel-Lucent's Interest Expense was €32 Mil. Its Operating Income was €-1,563 Mil. And its Long-Term Debt & Capital Lease Obligation was €3,160 Mil.

* 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.


Alcatel-Lucent  (XPAR:ALUNV) 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 .


Alcatel-Lucent Interest Coverage Related Terms

Thank you for viewing the detailed overview of Alcatel-Lucent's Interest Coverage provided by GuruFocus.com. Please click on the following links to see related term pages.


Alcatel-Lucent (XPAR:ALUNV) Business Description

Traded in Other Exchanges
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Alcatel-Lucent SA was incorporated on June 18, 1898. The Company is engaged in designing, manufacturing, operations and sales of equipment, material and software related to domestic, industrial, civil, military or other applications concerning electricity, telecommunications, computers, electronics, aerospace industry, nuclear energy, metallurgy, and, in general, of all the means of production or transmission of energy or communication. The Company's core Networking segment includes three business divisions: IP Routing, IP Transport and IP Platforms. The IP ROUTING focus is on the intelligent IP router market and emerging Software Defined Networking (SDN) markets and related professional services. In IP TRANSPORT segment company designs, manufactures and markets optical networking equipment to transport information over fiber optic connections over long distances on land or under sea, as well as for short distances in metropolitan and regional areas. The portfolio also includes related professional services and microwave wireless transmission equipment. In IP PLATFORMS, the Company offers software and services to service providers that allow them to meet the market evolution needs of mobile and fixed networks. The Company's access segment includes four business divisions: WIRELESS are committed to a wireless access portfolio that is suited to the operators that are moving to 4G/LTE quickly and decisively. FIXED ACCESS IP-based fixed access products and related professional services provides support for both DSL and fiber, allowing service providers to extend Ultra-Broadband access to the customer's premise regardless of technology and to seamlessly combine copper and fiber access technologies and FTTx deployment models to achieve the fastest return-on-investment and time-to-market. In LICENSING the Intellectual Property Business Group works to monetize the patent portfolio through licensing and patent sales while also maintaining and prosecuting patents. The managed services portfolio includes Build-Operate-Manage-Transfer (BOMT) Solutions, Operations Transformation Solutions, and Network Operations Services. These services can be delivered across a wide array of network technologies including Network Access (FTTx), Next generation wireless (LTE, Small Cells, 4G), and IP Networks. The Company's Other segment includes Enterprise and Government businesses to provide end-to-end products, solutions and services for small, medium, large and extra-large companies to improve conversations and collaboration across employees, customers and partners. The Company sells all of its products and services to the world's telecommunications service providers through its direct sales force. The Company's competitors include Avaya, Cisco Systems, Ericsson, Fujitsu, Huawei, Nokia Solutions and Networks (NSN), Samsung, Adtran, Calix, Ciena, Juniper, Ericsson and Huawei.

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