What does interest coverage mean?

How many times the company's operating profit covers its interest bill.

How do you interpret interest coverage?

Higher is safer; below ~2× is a warning that earnings provide little cushion against the debt burden. Debt-free companies have no interest expense and the ratio is left blank.

How does interest coverage compare across companies?

Comparable across leveraged non-financials; less relevant for net-cash companies with negligible interest.

American Express AXP Interest coverage

Interest coverage at other companies

JPMorgan ChaseJPM

1.8×0.0×

Capital One FinancialCOF

1.2×-0.2×

MastercardMA

27.1×+3.3×

CorpayCPAY

5.2×+0.6×

VisaV

42.3×+8.7×

Synchrony FinancialSYF

2.2×+0.3×

Other financials

Income statement

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Revenue$18.9B+11.4%

Net income$3.0B+15.0%

EPS (diluted)$4.28+17.6%

Balance sheet

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Cash & equivalents$53.8B+2.4%

Total debt$60.4B+14.5%

Total equity$34.0B+9.0%

Total assets$308.89B+9.4%

Cash flow

See full

Operating cash flow$3.8B-20.2%

CapEx$1.1B+167%

Free cash flow$2.7B-38.7%

Valuation

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Market cap$232.36B+10.0%

Enterprise value$239.04B+13.3%

P/E20.7×+0.1×

P/S3.1×0.0×

Profitability

See full

Net margin15.1%-0.2pp

Returns & leverage

See full

Return on equity34.4%+0.1pp

Debt / equity1.8×+0.1×

Questions, answered.

What does interest coverage mean?: How many times the company's operating profit covers its interest bill.
How do you interpret interest coverage?: Higher is safer; below ~2× is a warning that earnings provide little cushion against the debt burden. Debt-free companies have no interest expense and the ratio is left blank.
How does interest coverage compare across companies?: Comparable across leveraged non-financials; less relevant for net-cash companies with negligible interest.