Covidien (FRA:6COP) Debt-to-EBITDA : 1.62 (As of Dec. 2014)

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What is Covidien Debt-to-EBITDA?

Debt-to-EBITDA measures a company's ability to pay off its debt.

Covidien's Short-Term Debt & Capital Lease Obligation for the quarter that ended in Dec. 2014 was €819 Mil. Covidien's Long-Term Debt & Capital Lease Obligation for the quarter that ended in Dec. 2014 was €3,285 Mil. Covidien's annualized EBITDA for the quarter that ended in Dec. 2014 was €2,534 Mil. Covidien's annualized Debt-to-EBITDA for the quarter that ended in Dec. 2014 was 1.62.

A high Debt-to-EBITDA ratio generally means that a company may spend more time to paying off its debt. According to Joel Tillinghast's BIG MONEY THINKS SMALL: Biases, Blind Spots, and Smarter Investing, a ratio of Debt-to-EBITDA exceeding four is usually considered scary unless tangible assets cover the debt.

The historical rank and industry rank for Covidien's Debt-to-EBITDA or its related term are showing as below:

FRA:6COP' s Debt-to-EBITDA Range Over the Past 10 Years
Min: 0 Med: 0 Max: 1.88
Current: 1.88

During the past 13 years, the highest Debt-to-EBITDA Ratio of Covidien was 1.88. The lowest was 0.00. And the median was 0.00.

FRA:6COP's Debt-to-EBITDA is not ranked
in the Medical Devices & Instruments industry.
Industry Median: 1.235 vs FRA:6COP: 1.88

Covidien Debt-to-EBITDA Historical Data

The historical data trend for Covidien's Debt-to-EBITDA 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.

* Premium members only.

Covidien Debt-to-EBITDA Chart

Covidien Annual Data

Trend

Sep05

Sep06

Sep07

Sep08

Sep09

Sep10

Sep11

Sep12

Sep13

Sep14

Debt-to-EBITDA

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1.80

1.39

1.83

1.75

1.94

Covidien Quarterly Data
	Mar10	Jun10	Sep10	Dec10	Mar11	Jun11	Sep11	Dec11	Mar12	Jun12	Sep12	Dec12	Mar13	Jun13	Sep13	Dec13	Mar14	Jun14	Sep14	Dec14
Debt-to-EBITDA	Get a 7-Day Free Trial															1.79	1.58	2.49	2.08	1.62

Competitive Comparison of Covidien's Debt-to-EBITDA

For the Medical Instruments & Supplies subindustry, Covidien's Debt-to-EBITDA, along with its competitors' market caps and Debt-to-EBITDA 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.

Covidien's Debt-to-EBITDA Distribution in the Medical Devices & Instruments Industry

For the Medical Devices & Instruments industry and Healthcare sector, Covidien's Debt-to-EBITDA distribution charts can be found below:

* The bar in red indicates where Covidien's Debt-to-EBITDA falls into.

Covidien Debt-to-EBITDA Calculation

Debt-to-EBITDA measures a company's ability to pay off its debt.

Covidien's Debt-to-EBITDA for the fiscal year that ended in Sep. 2014 is calculated as

Debt-to-EBITDA	=	Total Debt			/	EBITDA
	=	(Short-Term Debt & Capital Lease Obligation	+	Long-Term Debt & Capital Lease Obligation)	/	EBITDA
	=	(782.984	+	3131.16)	/	2023.032
	=	1.93

Covidien's annualized Debt-to-EBITDA for the quarter that ended in Dec. 2014 is calculated as

Debt-to-EBITDA	=	Total Debt			/	EBITDA
	=	(Short-Term Debt & Capital Lease Obligation	+	Long-Term Debt & Capital Lease Obligation)	/	EBITDA
	=	(819.11	+	3285.361)	/	2533.564
	=	1.62

In the calculation of annual Debt-to-EBITDA, the EBITDA of the last fiscal year is used. In calculating the annualized quarterly data, the EBITDA data used here is four times the quarterly (Dec. 2014) EBITDA data.

Covidien (FRA:6COP) Debt-to-EBITDA Explanation

In the calculation of Debt-to-EBITDA, we use the total of Short-Term Debt & Capital Lease Obligation and Long-Term Debt & Capital Lease Obligation divided by EBITDA. In some calculations, Total Liabilities is used to for calculation.

Be Aware

A high Debt-to-EBITDA ratio generally means that a company may spend more time to paying off its debt.

According to Joel Tillinghast's BIG MONEY THINKS SMALL: Biases, Blind Spots, and Smarter Investing, a ratio of Debt-to-EBITDA exceeding four is usually considered scary unless tangible assets cover the debt.

Covidien Debt-to-EBITDA Related Terms

Thank you for viewing the detailed overview of Covidien's Debt-to-EBITDA provided by GuruFocus.com. Please click on the following links to see related term pages.

Covidien (FRA:6COP) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Healthcare » Medical Devices & Instruments » Covidien PLC (FRA:6COP) » Definitions » Debt-to-EBITDA

Comparable Companies

Traded in Other Exchanges

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Address

Website

http://www.covidien.com

Covidien PLC formerly known as Covidien Ltd. was incorporated in Bermuda in 2000 as a wholly-owned subsidiary of Tyco International Ltd. In June 2009, Covidien plc announced that one of its subsidiaries has completed the acquisition of VNUS Medical Technologies, Inc. In September 2009, the Company completed the acquisition of Power Medical Interventions Inc. In November 2009, the Company completed the acquisition of Aspect Medical Systems Inc. The Company is engaged in the development, manufacture and sale of healthcare products for use in clinical and home settings. Its products are found in almost every hospital in the United States. Its mission is to create and deliver innovative healthcare solutions, developed in ethical collaboration with medical professionals. It operates through two segments: Medical Devices and Medical Supplies. The Medical Devices segment includes the development, manufacture and sale of endomechanical instruments, energy devices, soft tissue repair products, vascular products, oximetry and monitoring products, airway and ventilation products, and other medical products. The Medical Supplies segment includes the development, manufacture and sale of nursing care products, medical surgical products, SharpSafety products and original equipment manufacturer products. Competitors of Medical Devices segment include diversified healthcare companies, such as Johnson & Johnson, Boston Scientific, Baxter and C.R. Bard. Its Nursing Care products include: Curity and Kerlix and Medical Surgical products include: Medi-Trace. The Company holds more than 13,000 patents and have over 10,500 patent applications pending in the United States and in certain other countries that relate to aspects of the technology used in many of its products. The Company is subject to numerous federal, state and local environmental protection and health and safety laws and regulations both within and outside the United States.

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