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Zacks.com featured highlights Disney, BJ's Wholesale Club, Ralph Lauren and McKesson

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For Immediate Release

Chicago, IL – August 5, 2025 – The stocks in this week’s article are The Walt Disney Co. (DIS - Free Report) , BJ's Wholesale Club Holdings, Inc. (BJ - Free Report) , Ralph Lauren Corp. (RL - Free Report) and McKesson Corp. (MCK - Free Report) .

Disney & 3 Other Stocks with Strong Interest Coverage to Buy Now

The recent market pullback, triggered by fresh tariffs and a stark slowdown in job growth, has shaken investor confidence. With July nonfarm payrolls rising by just 73,000, far below expectations, and June’s numbers revised drastically downward, the labor market appears weaker than initially thought. This deteriorating backdrop, combined with renewed trade tensions, has not only fueled expectations of a Federal Reserve rate cut but also created a wave of risk aversion, sending major indices sharply lower.

In such uncertain conditions, relying solely on stock price movements without understanding the company’s fundamentals can cause investors to lose money. Investors must carefully review a company's financial health to make informed decisions, especially in today’s unpredictable market.

While sales and earnings are often the go-to metrics, they can sometimes be misleading and may not show whether a company has the financial strength to cover its obligations. This is where the coverage ratio holds the key — a higher ratio signals that a company is more capable of meeting its financial commitments.

The Walt Disney Co., BJ's Wholesale Club Holdings, Inc., Ralph Lauren Corp. and McKesson Corp. have impressive interest coverage ratios.

Why Interest Coverage Ratio?

The interest coverage ratio is used to determine how effectively a company can pay interest charges on its debt.

Debt, which is crucial to financing operations for the majority of companies, comes at a cost called interest. Interest expense has a direct bearing on the profitability of a company. The company’s creditworthiness depends on how effectively it meets its interest obligations. Therefore, the interest coverage ratio is one of the important criteria to factor in before making any investment decision.

Interest Coverage Ratio = Earnings before Interest & Taxes (EBIT) divided by Interest Expense.

The interest coverage ratio suggests how many times the interest could be paid from earnings and gauges the margin of safety a firm has for paying interest.

An interest coverage ratio lower than 1 suggests that the company is unable to fulfill its interest obligations and could default on repaying debt. A company capable of generating earnings well above its interest expense can withstand financial hardships. One should also track the company’s past performance to determine whether the interest coverage ratio has improved or worsened over time.

Here are four of the nine stocks that qualified the screening:

Walt Disney, an iconic name in entertainment and media, carries a Zacks Rank #2 and has a VGM Score of B. The company has a trailing four-quarter earnings surprise of 16.4%, on average. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for Walt Disney’s current financial-year sales and EPS calls for growth of 4% and 16.3%, respectively, from the year-ago period. The stock has rallied 32.9% in the past year.

BJ's Wholesale Club, one of the leading operators of membership warehouse clubs, carries a Zacks Rank #2 and has a VGM Score of B. BJ delivered a trailing four-quarter earnings surprise of 17.7%, on average.

The Zacks Consensus Estimate for BJ's Wholesale Club’s current financial-year sales and EPS suggests growth of 5.5% and 6.2%, respectively, from a year ago. The stock has risen 29.1% in the past year.

Ralph Lauren, a global leader in the design, marketing and distribution of luxury lifestyle products, carries a Zacks Rank #2 and has a VGM Score of B. The company has a trailing four-quarter earnings surprise of 9%, on average.

The Zacks Consensus Estimate for Ralph Lauren’s current financial-year sales and EPS calls for growth of 3.8% and 11.8%, respectively, from the year-ago period. The stock has advanced 83.9% in the past year.

McKesson Corporation, a diversified healthcare services leader, carries a Zacks Rank #2 with a VGM score of A. The company has a trailing four-quarter earnings surprise of 3.9%, on average.

The Zacks Consensus Estimate for McKesson Corporation’s current financial-year sales and EPS implies growth of 13.1% and 12.7%, respectively, from the year-ago period. The stock has risen 14% in the past year.

You can get the rest of the stocks on this list by signing up now for your 2-week free trial to the Research Wizard and start using this screen in your own trading. Further, you can also create your own strategies and back test them first before taking the investment plunge.

The Research Wizard is a great place to begin. It's easy to use. Everything is in plain language. And it's very intuitive. Start your Research Wizard trial today. And the next time you read an economic report, open up the Research Wizard, plug your finds in, and see what gems come out.

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For the rest of this Screen of the Week article please visit Zacks.com at: https://www.zacks.com/stock/news/2662041/disney-3-other-stocks-with-strong-interest-coverage-to-buy-now

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Contact: Jim Giaquinto

Company: Zacks.com

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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.

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