Algonquin Power & Utilities (Algonquin Power & Utilities) Interest Coverage : 1.16 (As of Dec. 2023)

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What is Algonquin Power & Utilities 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. Algonquin Power & Utilities's Operating Income for the three months ended in Dec. 2023 was $118.45 Mil. Algonquin Power & Utilities's Interest Expense for the three months ended in Dec. 2023 was $-102.06 Mil. Algonquin Power & Utilities's interest coverage for the quarter that ended in Dec. 2023 was 1.16. The higher the ratio, the stronger the company's financial strength is.

Warning Sign:

Ben Graham prefers companies' interest coverage to be at least 5. Algonquin Power & Utilities Corp interest coverage is 1.29, which is low.

The historical rank and industry rank for Algonquin Power & Utilities's Interest Coverage or its related term are showing as below:

AQNU' s Interest Coverage Range Over the Past 10 Years
Min: 1.29 Med: 1.92 Max: 2.76
Current: 1.29

AQNU's Interest Coverage is ranked worse than
77.85% of 325 companies
in the Utilities - Independent Power Producers industry
Industry Median: 2.98 vs AQNU: 1.29

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

Algonquin Power & Utilities Interest Coverage Historical Data

The historical data trend for Algonquin Power & Utilities'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.

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Algonquin Power & Utilities Interest Coverage Chart

Algonquin Power & Utilities Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

Interest Coverage

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1.94

1.89

1.63

1.70

1.29

Algonquin Power & Utilities Quarterly Data
	Mar19	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23
Interest Coverage	Get a 7-Day Free Trial															1.58	1.65	1.07	1.30	1.16

Competitive Comparison of Algonquin Power & Utilities's Interest Coverage

For the Utilities - Renewable subindustry, Algonquin Power & Utilities'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.

Algonquin Power & Utilities's Interest Coverage Distribution in the Utilities - Independent Power Producers Industry

For the Utilities - Independent Power Producers industry and Utilities sector, Algonquin Power & Utilities's Interest Coverage distribution charts can be found below:

* The bar in red indicates where Algonquin Power & Utilities's Interest Coverage falls into.

Algonquin Power & Utilities 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.

Algonquin Power & Utilities's Interest Coverage for the fiscal year that ended in Dec. 2023 is calculated as

Here, for the fiscal year that ended in Dec. 2023, Algonquin Power & Utilities's Interest Expense was $-371.54 Mil. Its Operating Income was $477.79 Mil. And its Long-Term Debt & Capital Lease Obligation was $7,894.17 Mil.

Interest Coverage	=	-1	*	Operating Income (A: Dec. 2023 )	/	Interest Expense (A: Dec. 2023 )
	=	-1	*	477.791	/	-371.538
	=	1.29

Algonquin Power & Utilities's Interest Coverage for the quarter that ended in Dec. 2023 is calculated as

Here, for the three months ended in Dec. 2023, Algonquin Power & Utilities's Interest Expense was $-102.06 Mil. Its Operating Income was $118.45 Mil. And its Long-Term Debt & Capital Lease Obligation was $7,894.17 Mil.

Interest Coverage	=	-1	*	Operating Income (Q: Dec. 2023 )	/	Interest Expense (Q: Dec. 2023 )
	=	-1	*	118.45	/	-102.058
	=	1.16

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

Algonquin Power & Utilities (NYSE:AQNU) 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 .

Algonquin Power & Utilities Interest Coverage Related Terms

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

Algonquin Power & Utilities (Algonquin Power & Utilities) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Utilities » Utilities - Independent Power Producers » Algonquin Power & Utilities Corp (NYSE:AQNU) » Definitions » Interest Coverage

Comparable Companies

Traded in Other Exchanges

AGQPF.PFD:USA AQN:USA 751:Germany AQN.PR.D.PFD:Canada AQN.PR.A.PFD:Canada AQN:Canada

Address

354 Davis Road, Oakville, ON, CAN, L6J 2X1

Website

https://www.algonquinpower.com

Algonquin Power & Utilities Corp, a parent company of Liberty, is a diversified international generation, transmission, and distribution utility with over $16 billion of total assets. Through its two business groups, the Regulated Services Group and the Renewable Energy Group, AQN is committed to providing safe, secure, reliable, cost-effective, and sustainable energy and water solutions through its portfolio of electric generation, transmission, and distribution utility investments to over one million customer connections, largely in the United States and Canada. AQN provides renewable energy through its portfolio of long-term contracted wind, solar, and hydroelectric generating facilities.