Sun Life Financial (TSX:SLF.PR.D.PFD) Interest Coverage

: 7.84 (As of Dec. 2023)

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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 EBIT by its Interest Expense. Sun Life Financial's EBIT for the three months ended in Dec. 2023 was C$902.00 Mil. Sun Life Financial's Interest Expense for the three months ended in Dec. 2023 was C$-115.00 Mil. Sun Life Financial's interest coverage for the quarter that ended in Dec. 2023 was 7.84. The higher the ratio, the stronger the company's financial strength is.

The historical rank and industry rank for Sun Life Financial's Interest Coverage or its related term are showing as below:

TSX:SLF.PR.D.PFD' s Interest Coverage Range Over the Past 10 Years
Min: 8.06 Med: 10.23 Max: 16.59
Current: 8.12

TSX:SLF.PR.D.PFD's Interest Coverage is ranked worse than
63.78% of 323 companies
in the Insurance industry
Industry Median: 13.52 vs TSX:SLF.PR.D.PFD: 8.12

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

Sun Life Financial Interest Coverage Historical Data

The historical data trend for Sun Life Financial'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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Sun Life Financial Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

Interest Coverage

10.71

10.26

16.59

9.15

8.12

Sun Life Financial Quarterly Data
	Mar19	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23
Interest Coverage																9.92	9.11	7.11	8.38	7.84

Competitive Comparison

For the Insurance - Diversified subindustry, Sun Life Financial'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.

Sun Life Financial Interest Coverage Distribution

For the Insurance industry and Financial Services sector, Sun Life Financial's Interest Coverage distribution charts can be found below:

* The bar in red indicates where Sun Life Financial's Interest Coverage falls into.

Sun Life Financial 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 EBIT is positive, then

Interest Coverage

-1

EBIT

Interest Expense

Else if Interest Expense is negative and EBIT 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.

Sun Life Financial'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, Sun Life Financial's Interest Expense was C$-552.00 Mil. Its EBIT was C$4,482.00 Mil. And its Long-Term Debt & Capital Lease Obligation was C$10,947.00 Mil.

Interest Coverage	=	-1	*	EBIT (A: Dec. 2023 )	/	Interest Expense (A: Dec. 2023 )
	=	-1	*	4482	/	-552
	=	8.12

Sun Life Financial's Interest Coverage for the quarter that ended in Dec. 2023 is calculated as

Here, for the three months ended in Dec. 2023, Sun Life Financial's Interest Expense was C$-115.00 Mil. Its EBIT was C$902.00 Mil. And its Long-Term Debt & Capital Lease Obligation was C$10,947.00 Mil.

Interest Coverage	=	-1	*	EBIT (Q: Dec. 2023 )	/	Interest Expense (Q: Dec. 2023 )
	=	-1	*	902	/	-115
	=	7.84

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

Sun Life Financial (TSX:SLF.PR.D.PFD) 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 .

Sun Life Financial Interest Coverage Related Terms

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

Sun Life Financial (TSX:SLF.PR.D.PFD) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Financial Services » Insurance » Sun Life Financial Inc (TSX:SLF.PR.D.PFD) » Definitions » Interest Coverage

Comparable Companies

Traded in Other Exchanges

SUNFF.PFD:USA SLF:USA SLF:Philippines LIE:Germany SLF.PR.K.PFD:Canada SLF.PR.J.PFD:Canada SLF.PR.H.PFD:Canada SLF.PR.G.PFD:Canada SLF.PR.E.PFD:Canada SLF.PR.C.PFD:Canada SLF:Canada

Address

1 York Street, 31st Floor, Toronto, ON, CAN, M5J 0B6

Website

https://www.sunlife.com

Sun Life provides life insurance, retirement, and asset management products to individuals and corporate customers in Canada, the United States, and Asia. The company's investment management business contributes approximately 38% of its adjusted earnings and has around CAD 1 trillion in assets under management as of the second quarter of 2023. The Canada business contributes about 32% of adjusted earnings and provides individual life and health insurance, group insurance, retirement services, and wealth management solutions. The U.S. business contributes approximately 14% of earnings and is mainly focused on providing group insurance products and managing the in-force life insurance policies. Finally, the Asia segment contributes around 16% of earnings.

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