What does a high EBITDA to interest expense ratio suggest?

A high EBITDA to interest expense ratio indicates that a company has a strong ability to service its debt obligations. This ratio is used to assess how well a company can cover its interest payments with its earnings before interest, taxes, depreciation, and amortization (EBITDA). When the ratio is high, it suggests that the company's earnings are significantly greater than its interest expenses, providing a cushion for the company to meet its debt obligations.

This is generally a positive sign for investors and creditors, as it reflects financial stability and reduces the risk associated with the company’s ability to repay its debts. A robust ability to service debt can lead to lower borrowing costs and better access to capital.

Other options might explore different aspects of financial health or operational risk, but they do not present the same positive implication for the company's capacity to manage its debt as indicated by a high EBITDA to interest expense ratio.