Enterprise Value to EBITDA (EV/EBITDA)
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- Statement of Comprehensive Income
- Balance Sheet: Liabilities and Stockholders’ Equity
- Common-Size Balance Sheet: Liabilities and Stockholders’ Equity
- Enterprise Value to FCFF (EV/FCFF)
- Dividend Discount Model (DDM)
- Net Profit Margin since 2013
- Return on Assets (ROA) since 2013
- Current Ratio since 2013
- Price to Book Value (P/BV) since 2013
- Analysis of Revenues
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Earnings before Interest, Tax, Depreciation and Amortization (EBITDA)
American Airlines Group Inc., EBITDA calculation
US$ in millions
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
- Net Income (Loss)
- The net income exhibits significant volatility over the periods. It was positive in 2019 at $1,686 million but experienced a sharp decline in 2020, reaching a substantial loss of $8,885 million. The losses declined in 2021 to $1,993 million but remained negative. In 2022, the company returned to profitability with a modest net income of $127 million, which further improved to $822 million in 2023. This indicates a recovery trend following the severe downturn in 2020.
- Earnings Before Tax (EBT)
- A similar trend is observed in earnings before tax. EBT was positive at $2,256 million in 2019, followed by a steep decline to a loss of $11,453 million in 2020. The loss narrowed substantially in 2021 to $2,548 million. In 2022, EBT turned positive again, reaching $186 million and improved further to $1,121 million in 2023. This pattern confirms the strong negative impact in 2020 with gradual recovery thereafter.
- Earnings Before Interest and Tax (EBIT)
- EBIT followed a comparable trajectory. The company reported a healthy EBIT of $3,351 million in 2019 but faced a pronounced loss of $10,226 million in 2020. The loss was smaller in 2021, at $748 million. By 2022, EBIT turned positive, reaching $2,148 million and increased to $3,266 million in 2023, indicating a robust recovery in operational profitability.
- Earnings Before Interest, Tax, Depreciation and Amortization (EBITDA)
- EBITDA also reflects the substantial disruption in 2020, turning from a strong positive of $5,669 million in 2019 to a negative $7,856 million. In 2021, EBITDA rebounded to a positive $1,587 million. This upward trend continued in 2022 and 2023 with increases to $4,446 million and $5,520 million respectively, approaching pre-2020 levels and signaling improved operational cash flow.
- Overall Observations
- The financial data demonstrates a significant adverse impact occurring in 2020, characterized by large losses across all key profitability measures. This is followed by a steady improvement from 2021 onward, with the company returning to profitability by 2022 and strengthening its earnings up to 2023. The recovery is evident both at the net income level and across various earnings metrics, reflecting an improving financial position and operational performance after the downturn.
Enterprise Value to EBITDA Ratio, Current
American Airlines Group Inc., current EV/EBITDA calculation, comparison to benchmarks
| Selected Financial Data (US$ in millions) | |
| Enterprise value (EV) | |
| Earnings before interest, tax, depreciation and amortization (EBITDA) | |
| Valuation Ratio | |
| EV/EBITDA | |
| Benchmarks | |
| EV/EBITDA, Competitors1 | |
| FedEx Corp. | |
| Uber Technologies Inc. | |
| Union Pacific Corp. | |
| United Airlines Holdings Inc. | |
| United Parcel Service Inc. | |
| EV/EBITDA, Sector | |
| Transportation | |
| EV/EBITDA, Industry | |
| Industrials | |
Based on: 10-K (reporting date: 2023-12-31).
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
American Airlines Group Inc., historical EV/EBITDA calculation, comparison to benchmarks
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Enterprise value (EV)1 | ||||||
| Earnings before interest, tax, depreciation and amortization (EBITDA)2 | ||||||
| Valuation Ratio | ||||||
| EV/EBITDA3 | ||||||
| Benchmarks | ||||||
| EV/EBITDA, Competitors4 | ||||||
| FedEx Corp. | ||||||
| Uber Technologies Inc. | ||||||
| Union Pacific Corp. | ||||||
| United Airlines Holdings Inc. | ||||||
| United Parcel Service Inc. | ||||||
| EV/EBITDA, Sector | ||||||
| Transportation | ||||||
| EV/EBITDA, Industry | ||||||
| Industrials | ||||||
Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).
3 2023 Calculation
EV/EBITDA = EV ÷ EBITDA
= ÷ =
4 Click competitor name to see calculations.
- Enterprise Value (EV)
- The enterprise value exhibited a moderate fluctuation over the five-year span. Starting at $32,401 million in 2019, it rose to a peak of $36,628 million in 2020, followed by a gradual decline through 2023, ending at $34,098 million. This indicates an initial increase in market valuation or debt changes during 2020, with a relatively stable but slightly declining trend thereafter.
- Earnings Before Interest, Tax, Depreciation, and Amortization (EBITDA)
- EBITDA showed significant volatility within the period. It began positively at $5,669 million in 2019, sharply declined to a negative $7,856 million in 2020, reflecting substantial operational losses that year. Subsequently, the company experienced a recovery, returning to positive EBITDA of $1,587 million in 2021, increasing further to $4,446 million in 2022, and reaching $5,520 million in 2023. This trajectory suggests a strong operational rebound post-2020 downturn.
- EV/EBITDA Ratio
- The EV/EBITDA ratio was 5.72 in 2019, indicating a moderate valuation relative to earnings. The ratio is not computable for 2020 due to negative EBITDA. In 2021, it surged dramatically to 22.66, which can be attributed to the lower positive EBITDA that year combined with relatively stable enterprise value, implying a higher valuation multiple. The ratio then decreased to 8.06 in 2022 and further to 6.18 in 2023, reflecting improving earnings and more balanced valuation multiples as EBITDA increased.
- Overall Insights
- The data reveals a significant operational impact in 2020, likely due to external adverse factors, causing losses and a negative EBITDA. The enterprise value, however, remained high during this period, possibly due to market expectations or financial structuring. The subsequent years show a consistent recovery of EBITDA, indicating operational improvement and financial stabilization. Correspondingly, valuation multiples adjusted downward from the peak in 2021, aligning more closely with improved earnings and suggesting restored market confidence over time.