Microsoft Excel LibreOffice Calc

Enterprise Value to EBITDA (EV/EBITDA)

Difficulty: Intermediate


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

Biogen Inc., EBITDA calculation

USD $ in thousands

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12 months ended Dec 31, 2017 Dec 31, 2016 Dec 31, 2015 Dec 31, 2014 Dec 31, 2013
Net income attributable to Biogen Inc. 2,539,100  3,702,800  3,547,000  2,934,784  1,862,341 
Add: Net income attributable to noncontrolling interest 131,000  (7,100) 46,200  6,781 
Add: Income tax expense 2,458,700  1,237,300  1,161,600  989,942  601,014 
Earnings before tax (EBT) 5,128,800  4,933,000  4,754,800  3,931,507  2,463,355 
Add: Interest expense 250,800  260,000  95,500  29,500  31,900 
Earnings before interest and tax (EBIT) 5,379,600  5,193,000  4,850,300  3,961,007  2,495,255 
Add: Depreciation and amortization 1,081,000  682,700  600,400  688,150  531,740 
Earnings before interest, tax, depreciation and amortization (EBITDA) 6,460,600  5,875,700  5,450,700  4,649,157  3,026,995 
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. Biogen Inc.'s EBITDA increased from 2015 to 2016 and from 2016 to 2017.

Enterprise Value to EBITDA Ratio, Current

Biogen Inc., current EV/EBITDA calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Selected Financial Data (USD $ in thousands)
Enterprise value (EV) 70,870,108 
Earnings before interest, tax, depreciation and amortization (EBITDA) 6,460,600 
Ratio
EV/EBITDA 10.97
Benchmarks
EV/EBITDA, Competitors
Abbott Laboratories 21.10
AbbVie Inc. 16.88
Allergan PLC
Amgen Inc. 9.34
Bristol-Myers Squibb Co. 16.28
Celgene Corp. 12.55
Eli Lilly & Co. 29.24
Gilead Sciences Inc. 6.60
Johnson & Johnson 15.10
Merck & Co. Inc. 16.40
Pfizer Inc. 13.36
Regeneron Pharmaceuticals Inc. 17.07
EV/EBITDA, Sector
Pharmaceuticals & Biotechnology 14.90
EV/EBITDA, Industry
Health Care 15.12

If company EV/EBITDA is lower then the EV/EBITDA of benchmark then company is relatively undervalued.

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


Enterprise Value to EBITDA Ratio, Historical

Biogen Inc., historical EV/EBITDA calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Dec 31, 2017 Dec 31, 2016 Dec 31, 2015 Dec 31, 2014 Dec 31, 2013
Selected Financial Data (USD $ in thousands)
Enterprise value (EV)1 75,435,189  58,671,782  62,235,563  90,507,256  70,530,731 
Earnings before interest, tax, depreciation and amortization (EBITDA)2 6,460,600  5,875,700  5,450,700  4,649,157  3,026,995 
Ratio
EV/EBITDA3 11.68 9.99 11.42 19.47 23.30
Benchmarks
EV/EBITDA, Competitors
Abbott Laboratories 20.08 25.22 12.40 17.78 13.30
AbbVie Inc. 20.80 12.73 13.50 29.11 13.16
Allergan PLC 20.95 59.52 59.49 74.17
Amgen Inc. 9.37 9.60 9.91 13.96 14.22
Bristol-Myers Squibb Co. 17.25 14.26 39.09 32.88 24.30
Celgene Corp. 14.20 28.50 31.19 34.11 30.94
Eli Lilly & Co. 22.72 18.40 19.15 18.17 8.65
Gilead Sciences Inc. 7.11 5.57 5.56 9.70 27.58
Johnson & Johnson 15.04 13.07 11.54 10.63 12.36
Merck & Co. Inc. 13.74 17.75 12.35 6.96 13.26
Pfizer Inc. 11.92 14.86 13.02 11.04 8.89
Regeneron Pharmaceuticals Inc. 15.13 26.10 28.77 47.11 40.56
EV/EBITDA, Sector
Pharmaceuticals & Biotechnology 14.59 13.50 13.31 13.52 14.20
EV/EBITDA, Industry
Health Care 14.56 13.38 13.26 13.26 13.44

2017 Calculations

3 EV/EBITDA = EV ÷ EBITDA
= 75,435,189 ÷ 6,460,600 = 11.68

Ratio Description The company
EV/EBITDA EV/EBITDA is a valuation indicator for the overall company rather than common stock. Biogen Inc.'s EV/EBITDA ratio declined from 2015 to 2016 but then increased from 2016 to 2017 exceeding 2015 level.