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Advance Auto Parts Interest Coverage

: 19.69 (As of Jun. 2019)
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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 (EBIT) by its Interest Expense. Advance Auto Parts's Operating Income for the three months ended in Jun. 2019 was USD 171 Mil. Advance Auto Parts's Interest Expense for the three months ended in Jun. 2019 was USD -9 Mil. Advance Auto Parts's interest coverage for the quarter that ended in Jun. 2019 was 19.69. The higher the ratio, the stronger the company's financial strength is.

NYSE:AAP' s Interest Coverage Range Over the Past 10 Years
Min: 9.7   Max: 21.78
Current: 12.43

9.7
21.78

NYSE:AAP's Interest Coverage is ranked higher than
53% of the 742 Companies
in the Retail - Apparel & Specialty industry.

( Industry Median: 10.77 vs. NYSE:AAP: 12.43 )

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


Advance Auto Parts Interest Coverage Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

* Premium members only.

Advance Auto Parts Annual Data
Dec09 Dec10 Dec11 Dec12 Dec13 Dec14 Dec15 Dec16 Dec17 Dec18
Interest Coverage Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 11.60 12.63 13.15 9.70 10.68

Advance Auto Parts Quarterly Data
Sep14 Dec14 Apr15 Jun15 Sep15 Dec15 Apr16 Jun16 Sep16 Dec16 Apr17 Jun17 Sep17 Dec17 Apr18 Jun18 Sep18 Dec18 Apr19 Jun19
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 13.03 11.80 6.49 13.91 19.69

Competitive Comparison
* 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.


Advance Auto Parts Interest Coverage Distribution

* The bar in red indicates where Advance Auto Parts's Interest Coverage falls into.



Advance Auto Parts 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.

Advance Auto Parts's Interest Coverage for the fiscal year that ended in Dec. 2018 is calculated as

Here, for the fiscal year that ended in Dec. 2018, Advance Auto Parts's Interest Expense was USD -57 Mil. Its Operating Income was USD 604 Mil. And its Long-Term Debt & Capital Lease Obligation was USD 1,046 Mil.

Interest Coverage=-1*Operating Income (A: Dec. 2018 )/Interest Expense (A: Dec. 2018 )
=-1*604.275/-56.588
=10.68

Advance Auto Parts's Interest Coverage for the quarter that ended in Jun. 2019 is calculated as

Here, for the three months ended in Jun. 2019, Advance Auto Parts's Interest Expense was USD -9 Mil. Its Operating Income was USD 171 Mil. And its Long-Term Debt & Capital Lease Obligation was USD 2,779 Mil.

Interest Coverage=-1*Operating Income (Q: Jun. 2019 )/Interest Expense (Q: Jun. 2019 )
=-1*170.772/-8.675
=19.69

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

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


Advance Auto Parts  (NYSE:AAP) 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 .


Advance Auto Parts Interest Coverage Related Terms


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