Amazon.com Inc. (NASDAQ:AMZN)

Enterprise Value to EBITDA (EV/EBITDA)

Intermediate level

Earnings before Interest, Tax, Depreciation and Amortization (EBITDA)
EV to EBITDA Ratio, Current
EV to EBITDA Ratio, Historical

Earnings before Interest, Tax, Depreciation and Amortization (EBITDA)

Amazon.com Inc., EBITDA calculation

US$ in millions

12 months ended	Dec 31, 2019	Dec 31, 2018	Dec 31, 2017	Dec 31, 2016	Dec 31, 2015
Net income	11,588	10,073	3,033	2,371	596
Add: Income tax expense	2,374	1,197	769	1,425	950
Earnings before tax (EBT)	13,962	11,270	3,802	3,796	1,546
Add: Interest expense	1,600	1,417	848	484	459
Earnings before interest and tax (EBIT)	15,562	12,687	4,650	4,280	2,005
Add: Depreciation and amortization of property and equipment and capitalized content costs, operating lease assets, and other	21,789	15,341	11,478	8,116	6,281
Earnings before interest, tax, depreciation and amortization (EBITDA)	37,351	28,028	16,128	12,396	8,286

Based on: 10-K (filing date: 2020-01-31), 10-K (filing date: 2019-02-01), 10-K (filing date: 2018-02-02), 10-K (filing date: 2017-02-10), 10-K (filing date: 2016-01-29).

Item	Description	The company
EBITDA	To calculate EBITDA analysts start with net earnings. To that earnings number, interest, taxes, depreciation, and amortization are added. EBITDA as a pre-interest number is a flow to all providers of capital.	Amazon.com Inc.’s EBITDA increased from 2017 to 2018 and from 2018 to 2019.

Enterprise Value to EBITDA Ratio, Current

Amazon.com Inc., current EV/EBITDA calculation, comparison to benchmarks

Selected Financial Data (US$ in millions)
Enterprise value (EV)	998,074
Earnings before interest, tax, depreciation and amortization (EBITDA)	37,351
Valuation Ratio
EV/EBITDA	26.72
Benchmarks
EV/EBITDA, Competitors¹
Costco Wholesale Corp.	20.57
Home Depot Inc.	12.96
Lowe’s Cos. Inc.	11.24
Target Corp.	8.00
TJX Cos. Inc.	10.30
Walmart Inc.	11.79
EV/EBITDA, Sector
General Retailers	19.02
EV/EBITDA, Industry
Consumer Services	14.23

Based on: 10-K (filing date: 2020-01-31).

¹ Click competitor name to see calculations.

If the company EV/EBITDA is lower then the EV/EBITDA of benchmark then company is relatively undervalued.
Otherwise, if the company EV/EBITDA is higher then the EV/EBITDA of benchmark then company is relatively overvalued.

Enterprise Value to EBITDA Ratio, Historical

Amazon.com Inc., historical EV/EBITDA calculation, comparison to benchmarks

	Dec 31, 2019	Dec 31, 2018	Dec 31, 2017	Dec 31, 2016	Dec 31, 2015
Selected Financial Data (US$ in millions)
Enterprise value (EV)¹	996,641	799,795	700,383	386,686	272,288
Earnings before interest, tax, depreciation and amortization (EBITDA)²	37,351	28,028	16,128	12,396	8,286
Valuation Ratio
EV/EBITDA³	26.68	28.54	43.43	31.19	32.86
Benchmarks
EV/EBITDA, Competitors⁴
Costco Wholesale Corp.	20.07	15.77	12.63	13.27	13.49
Home Depot Inc.	13.36	13.46	12.90	13.23	12.90
Lowe’s Cos. Inc.	18.22	11.22	11.41	12.17	12.78
Target Corp.	7.49	6.96	5.59	7.47	9.21
TJX Cos. Inc.	12.61	11.11	11.16	11.83	11.14
Walmart Inc.	13.73	10.91	7.91	7.75	8.40
EV/EBITDA, Sector
General Retailers	18.53	16.45	15.75	13.00	12.54
EV/EBITDA, Industry
Consumer Services	14.95	14.16	13.55	12.37	12.26

Based on: 10-K (filing date: 2020-01-31), 10-K (filing date: 2019-02-01), 10-K (filing date: 2018-02-02), 10-K (filing date: 2017-02-10), 10-K (filing date: 2016-01-29).

¹ See details »

² See details »

³ 2019 Calculation
EV/EBITDA = EV ÷ EBITDA
= 996,641 ÷ 37,351 = 26.68

⁴ Click competitor name to see calculations.

Valuation ratio	Description	The company
EV/EBITDA	Enterprise value to earnings before interest, tax, depreciation and amortization is a valuation indicator for the overall company rather than common stock.	Amazon.com Inc.’s EV/EBITDA ratio decreased from 2017 to 2018 and from 2018 to 2019.