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What Is the Debt-Service Coverage Ratio?

By Motley Fool StaffUpdated Aug 7, 2025 at 7:13 PM

Key Points

  • DSCR measures if a company earns enough to cover its debts.
  • A DSCR below 1 indicates a company cannot fully cover its debt payments.
  • Investors should track DSCR over time, not just at one point.

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