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PayPal Holdings Interest Coverage

: 12.38 (As of Jun. 2022)
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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. PayPal Holdings's Operating Income for the three months ended in Jun. 2022 was $854 Mil. PayPal Holdings's Interest Expense for the three months ended in Jun. 2022 was $-69 Mil. PayPal Holdings's interest coverage for the quarter that ended in Jun. 2022 was 12.38. The higher the ratio, the stronger the company's financial strength is.

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

PYPL' s Interest Coverage Range Over the Past 10 Years
Min: 15.09   Med: 322.71   Max: No Debt
Current: 15.09


PYPL's Interest Coverage is ranked worse than
70.11% of 184 companies
in the Credit Services industry
Industry Median: 479.55 vs PYPL: 15.09

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


PayPal Holdings Interest Coverage Historical Data

The historical data trend for PayPal Holdings'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.

PayPal Holdings Annual Data
Trend Dec12 Dec13 Dec14 Dec15 Dec16 Dec17 Dec18 Dec19 Dec20 Dec21
Interest Coverage
Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 322.71 32.51 24.26 16.40 18.64

PayPal Holdings Quarterly Data
Sep17 Dec17 Mar18 Jun18 Sep18 Dec18 Mar19 Jun19 Sep19 Dec19 Mar20 Jun20 Sep20 Dec20 Mar21 Jun21 Sep21 Dec21 Mar22 Jun22
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 19.79 18.00 17.83 12.66 12.38

Competitive Comparison

For the Credit Services subindustry, PayPal Holdings'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.

   

PayPal Holdings Interest Coverage Distribution

For the Credit Services industry and Financial Services sector, PayPal Holdings's Interest Coverage distribution charts can be found below:

* The bar in red indicates where PayPal Holdings's Interest Coverage falls into.



PayPal Holdings 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.

PayPal Holdings's Interest Coverage for the fiscal year that ended in Dec. 2021 is calculated as

Here, for the fiscal year that ended in Dec. 2021, PayPal Holdings's Interest Expense was $-232 Mil. Its Operating Income was $4,324 Mil. And its Long-Term Debt & Capital Lease Obligation was $8,049 Mil.

Interest Coverage=-1* Operating Income (A: Dec. 2021 )/Interest Expense (A: Dec. 2021 )
=-1*4324/-232
=18.64

PayPal Holdings's Interest Coverage for the quarter that ended in Jun. 2022 is calculated as

Here, for the three months ended in Jun. 2022, PayPal Holdings's Interest Expense was $-69 Mil. Its Operating Income was $854 Mil. And its Long-Term Debt & Capital Lease Obligation was $10,198 Mil.

Interest Coverage=-1* Operating Income (Q: Jun. 2022 )/Interest Expense (Q: Jun. 2022 )
=-1*854/-69
=12.38

* 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.


PayPal Holdings  (NAS:PYPL) 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 .


PayPal Holdings Interest Coverage Related Terms

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


PayPal Holdings Business Description

PayPal Holdings logo
Address
2211 North First Street, San Jose, CA, USA, 95131
PayPal was spun off from eBay in 2015 and provides electronic payment solutions to merchants and consumers, with a focus on online transactions. The company had 426 million active accounts at the end of 2021, including 34 million merchant accounts. The company also owns Xoom, an international money transfer business, and Venmo, a person-to-person payment platform.
Executives
Scheibe Gabrielle officer: SVP, Corp Finance & Investor R 2211 NORTH FIRST STREET SAN JOSE CA 95131
Lores Enrique director 3000 HANOVER STREET PALO ALTO CA 94304
Karbowski Jeffrey William officer: VP, Chief Accounting Officer 2211 N 1ST ST SAN JOSE CA 95131
Alford Peggy officer: EVP, Global Sales 435 TASSO STREET PALO ALTO CA 94301
Rainey John D officer: CFO and EVP, Global Cust Oper C/O PAYPAL HOLDINGS, INC. 2211 NORTH FIRST STREET SAN JOSE CA 95131
Johnson Allison officer: EVP, Chief Marketing Officer C/O PAYPAL HOLDINGS INC 2211 NORTH FIRST STREET SAN JOSE CA 95131
Britto Mark officer: EVP, Global Sales and Credit C/O PAYPAL HOLDINGS, INC. 2211 NORTH FIRST STREET SAN JOSE CA 95131
Messemer Deborah M. director C/O ALLOGENE THERAPEUTICS, INC. 210 EAST GRAND AVENUE SOUTH SAN FRANCISCO CA 94080
Adkins Rodney C director 55 GLENLAKE PARKWAY, NE ATLANTA GA 30328
Sarnoff Ann director C/O HSN, INC. 1 HSN DRIVE SAINT PETERSBURG FL 33729
Karczmer Aaron officer: SVP, CR & Compliance Officer PAYPAL HOLDINGS, INC. 2211 NORTH FIRST STREET SAN JOSE CA 95131
Johnson Belinda J. director 394 PACIFIC AVENUE, FLOOR 2 SAN FRANCISCO CA 94111
Shivananda Sripada officer: SVP, Chief Technology Officer 2211 NORTH FIRST STREET 2211 NORTH FIRST STREET SAN JOSE CA 95131
Casares Wences director C/O PAYPAL HOLDINGS, INC. 2211 NORTH FIRST STREET SAN JOSE CA 95131
Morales-jaffe Marcia officer: SVP, Human Resources C/O PAYPAL HOLDINGS, INC. 2211 NORTH FIRST STREET SAN JOSE CA 95131

PayPal Holdings Headlines

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