MetaCap
Glossary • October 8, 2026

Interest Coverage Ratio

Earnings Before Interest and Taxes (EBIT) divided by interest expense. Measures ability to pay debt. Ratio >2.5x is generally healthy.

Earnings Before Interest and Taxes (EBIT) divided by interest expense. Measures ability to pay debt. Ratio >2.5x is generally healthy.

Key Takeaway

Interest Coverage Ratio is a key concept in investing and finance. Understand it to make better investment decisions.

Sources

Author: metacap-editorial-team

Last updated: October 8, 2026