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Avis Budget Group Interest Coverage

: 7.22 (As of Sep. 2021)
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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. Avis Budget Group's Operating Income for the three months ended in Sep. 2021 was $917 Mil. Avis Budget Group's Interest Expense for the three months ended in Sep. 2021 was $-127 Mil. Avis Budget Group's interest coverage for the quarter that ended in Sep. 2021 was 7.22. The higher the ratio, the stronger the company's financial strength is.

Warning Sign:

Ben Graham prefers companies interest coverage is at least 5. Avis Budget Group Inc interest coverage is 2.8, which is low.

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

NAS:CAR' s Interest Coverage Range Over the Past 10 Years
Min: 1.12   Med: 1.72   Max: 2.8
Current: 2.8

1.12
2.8

NAS:CAR's Interest Coverage is ranked lower than
83% of the 743 Companies
in the Business Services industry.

( Industry Median: 15.81 vs. NAS:CAR: 2.80 )

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


Avis Budget Group Interest Coverage Historical Data

The historical data trend for Avis Budget 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.

* Premium members only.

Avis Budget Group Annual Data
Trend Dec11 Dec12 Dec13 Dec14 Dec15 Dec16 Dec17 Dec18 Dec19 Dec20
Interest Coverage
Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 1.76 1.72 1.56 1.50 -

Avis Budget Group Quarterly Data
Dec16 Mar17 Jun17 Sep17 Dec17 Mar18 Jun18 Sep18 Dec18 Mar19 Jun19 Sep19 Dec19 Mar20 Jun20 Sep20 Dec20 Mar21 Jun21 Sep21
Interest Coverage 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 Premium Member Only Premium Member Only Premium Member Only 0.74 - - 4.45 7.22

Competitive Comparison

For the Rental & Leasing Services subindustry, Avis Budget 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.

   

Avis Budget Group Interest Coverage Distribution

For the Business Services industry and Industrials sector, Avis Budget Group's Interest Coverage distribution charts can be found below:

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



Avis Budget 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.


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

Avis Budget Group's Interest Coverage for the fiscal year that ended in Dec. 2020 is calculated as

Here, for the fiscal year that ended in Dec. 2020, Avis Budget Group's Interest Expense was $-549 Mil. Its Operating Income was $-434 Mil. And its Long-Term Debt & Capital Lease Obligation was $13,126 Mil.

Avis Budget Group did not have earnings to cover the interest expense.

Avis Budget Group's Interest Coverage for the quarter that ended in Sep. 2021 is calculated as

Here, for the three months ended in Sep. 2021, Avis Budget Group's Interest Expense was $-127 Mil. Its Operating Income was $917 Mil. And its Long-Term Debt & Capital Lease Obligation was $16,620 Mil.

Interest Coverage=-1* Operating Income (Q: Sep. 2021 )/Interest Expense (Q: Sep. 2021 )
=-1*917/-127
=7.22

* 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.


Avis Budget Group  (NAS:CAR) 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 .


Avis Budget Group Interest Coverage Related Terms

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


Avis Budget Group Business Description

Avis Budget Group logo
Industry
Industrials » Business Services NAICS : 532111 SIC : 7514
Traded in Other Exchanges
Address
6 Sylvan Way, Parsippany, NJ, USA, 07054
Avis Budget Group Inc is a provider of automotive vehicle rental and car-sharing services. Its brands include Avis, Budget, and Zipcar. Avis is targeted to serve the premium commercial and leisure segments of the travel industry, while Budget is focused on value-conscious customers. The company operates its own network of rental locations and licenses its brands to franchisees. Zipcar is a car-sharing service that allows members to use the company-owned Zipcar fleet at an hourly rate. The company's largest region by revenue is the Americas.
Executives
Ferraro Joseph A. officer: President and CEO 6 SYLVAN WAY PARSIPPANY NJ 07054
Martins Izilda P officer: EVP, Americas 6 SYLVAN WAY PARSIPPANY NJ 07054
Sarma Karthik R. director, 10 percent owner ONE BRYANT PARK 39TH FLOOR NEW YORK NY 10036
Srs Investment Management, Llc director, 10 percent owner 1 BRYANT PARK 39TH FLOOR NEW YORK NY 10036
Hees Bernardo director, officer: Executive Chairman C/O THE KRAFT HEINZ COMPANY ONE PPG PLACE, SUITE 3200 PITTSBURGH PA 15222
Choi Brian J officer: EVP & Chief Financial Officer C/O SRS INVESTMENT MANAGEMENT, LLC ONE BRYANT PARK, 39TH FLOOR NEW YORK NY 10036
Rankin Patrick K officer: President, International 6 SYLVAN WAY PARSIPPANY NJ 07054
Lurie Glenn director C/O SYNCHRONOSS TECHNOLOGIES, INC. 200 CROSSING BLVD. BRIDGEWATER NJ 08807
Sparks Carl director 4315 NORTHAVEN ROAD DALLAS TX 75229
Krominga Lynn director 6 SYLVAN WAY PARSIPPANY NJ 07054
North John F officer: EVP & Chief Financial Officer 150 N. BARTLETT STREET MEDFORD OR 97501
Sera Jean M officer: SVP, GC & Corp. Sec. AVIS BUDGET GROUP 6 SYLVAN WAY PARSIPPANY NJ 07054
Fox Jeffrey H director ONE ALLIED DRIVE LITTLE ROCK AR 72202
Salerno F Robert director AVIS RENT A CAR INC 900 OLD COUNTRY RD GARDEN CITY NY 11530
Degenova Cathleen officer: Chief Accounting Officer 6 SYLVAN WAY PARSIPPANY NJ 07054

Avis Budget Group Headlines

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