Debt Service Coverage Ratio (DSCR)
Category: Lending
A measure of the cash flow available to pay current debt obligations. It is calculated by dividing the company's EBITDA or operating cash flow by its total debt service (interest + principal).
Example
If a company has an EBITDA of $2,000,000 and total debt service of $1,500,000, its DSCR is 1.33x.