Enterprise Value to EBITDA (EV/EBITDA)
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Celgene Corp. pages available for free this week:
- Common-Size Balance Sheet: Assets
- Analysis of Short-term (Operating) Activity Ratios
- Common Stock Valuation Ratios
- Enterprise Value (EV)
- Price to FCFE (P/FCFE)
- Dividend Discount Model (DDM)
- Present Value of Free Cash Flow to Equity (FCFE)
- Return on Equity (ROE) since 2005
- Return on Assets (ROA) since 2005
- Price to Sales (P/S) since 2005
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Earnings before Interest, Tax, Depreciation and Amortization (EBITDA)
Celgene Corp., EBITDA calculation
US$ in millions
Based on: 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31).
- Net Income
- The net income exhibits a fluctuating yet ultimately upward trend from 2014 to 2018. It decreased from 2000 million USD in 2014 to 1602 million USD in 2015, indicating a decline during that year. However, from 2015 onwards, net income increased steadily, reaching 1999 million USD in 2016, then rising substantially to 2940 million USD in 2017 and further to 4046 million USD by 2018. This represents a significant overall growth over the five-year period.
- Earnings Before Tax (EBT)
- The earnings before tax follow a similar pattern to net income but remain consistently higher, reflecting tax effects. There was a decline from 2327 million USD in 2014 to 2024 million USD in 2015. Thereafter, EBT increased steadily through the years, moving to 2373 million USD in 2016, 4314 million USD in 2017, and reaching 4832 million USD in 2018. The growth is quite pronounced in the last two years, with almost a doubling from 2016 to 2018.
- Earnings Before Interest and Tax (EBIT)
- The EBIT figures show a generally positive trend throughout the period. Starting at 2504 million USD in 2014, there is a slight decline to 2334 million USD in 2015. Afterward, EBIT climbs consistently: 2873 million USD in 2016, followed by a sharp increase to 4836 million USD in 2017, and 5573 million USD in 2018. The significant rise in 2017 and 2018 suggests improved operational performance and profitability before financing and tax expenses.
- Earnings Before Interest, Tax, Depreciation and Amortization (EBITDA)
- The EBITDA amounts reflect the company's earnings before non-cash expenses, showing strong growth over the years. Starting at 2877 million USD in 2014, it decreased somewhat to 2743 million USD in 2015. Thereafter, EBITDA rose steadily, reaching 3377 million USD in 2016, then increasing sharply to 5307 million USD in 2017, and 6208 million USD in 2018. This significant growth in the last two years highlights strengthening cash earnings capacity and operational efficiency.
- Overall Analysis
- The data reveals an initial dip in earnings across all measures from 2014 to 2015, followed by robust growth through 2018. The pronounced increases in all earnings metrics from 2016 onwards, especially between 2017 and 2018, indicate improving profitability and operational performance. The consistent upward trend in EBITDA suggests enhancement in cash-based earnings and efficient management of non-cash expenses. Overall, the financial data portrays a positive trajectory with substantial growth in profitability over the analyzed period.
Enterprise Value to EBITDA Ratio, Current
Celgene Corp., 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 | |
| AbbVie Inc. | |
| Amgen Inc. | |
| Bristol-Myers Squibb Co. | |
| Danaher Corp. | |
| Eli Lilly & Co. | |
| Gilead Sciences Inc. | |
| Johnson & Johnson | |
| Merck & Co. Inc. | |
| Pfizer Inc. | |
| Regeneron Pharmaceuticals Inc. | |
| Thermo Fisher Scientific Inc. | |
| Vertex Pharmaceuticals Inc. | |
Based on: 10-K (reporting date: 2018-12-31).
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
Celgene Corp., historical EV/EBITDA calculation, comparison to benchmarks
| Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | Dec 31, 2014 | ||
|---|---|---|---|---|---|---|
| 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 | ||||||
| AbbVie Inc. | ||||||
| Amgen Inc. | ||||||
| Bristol-Myers Squibb Co. | ||||||
| Danaher Corp. | ||||||
| Eli Lilly & Co. | ||||||
| Gilead Sciences Inc. | ||||||
| Johnson & Johnson | ||||||
| Merck & Co. Inc. | ||||||
| Pfizer Inc. | ||||||
| Regeneron Pharmaceuticals Inc. | ||||||
| Thermo Fisher Scientific Inc. | ||||||
| Vertex Pharmaceuticals Inc. | ||||||
Based on: 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31).
3 2018 Calculation
EV/EBITDA = EV ÷ EBITDA
= ÷ =
4 Click competitor name to see calculations.
- Enterprise Value (EV)
- The enterprise value exhibited a fluctuating trend over the period under review. It started at 98,142 million USD at the end of 2014 and decreased to 85,544 million USD in 2015. Following this, there was a recovery in 2016 where the EV increased to 96,260 million USD, but it declined significantly in 2017 to 75,373 million USD and experienced a slight increase in 2018 reaching 77,219 million USD. Overall, the EV shows volatility with a downward tendency from 2014 to 2018.
- Earnings Before Interest, Tax, Depreciation, and Amortization (EBITDA)
- EBITDA demonstrated a consistent upward trend throughout the period. Starting at 2,877 million USD in 2014, it slightly decreased to 2,743 million USD in 2015 but then increased steadily year-on-year, reaching 3,377 million USD in 2016, followed by a significant jump to 5,307 million USD in 2017 and further to 6,208 million USD in 2018. This indicates improving operational profitability over the years.
- EV/EBITDA Ratio
- The EV/EBITDA ratio showed a marked decline from 2014 to 2018, decreasing from 34.11 in 2014 to 12.44 in 2018. This decline in the ratio is principally driven by the increase in EBITDA and the reduction in enterprise value. A lower EV/EBITDA ratio typically suggests that the company became more attractively valued relative to its earnings capacity over this period.