Enterprise Value to EBITDA (EV/EBITDA)
Earnings before Interest, Tax, Depreciation and Amortization (EBITDA)
O’Reilly Automotive Inc., EBITDA calculation
US$ in thousands
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
- Net Income Trend
- The net income shows a consistent upward trajectory from 2017 to 2021, increasing from approximately 1.13 billion to 2.16 billion US dollars. This represents a nearly doubling of net income over the five-year period, indicating strong profitability growth.
- Earnings Before Tax (EBT)
- EBT similarly exhibits continuous growth during the period, rising from about 1.64 billion in 2017 to 2.78 billion in 2021. This growth in pre-tax earnings signals improving operational efficiency or increasing revenue generation before tax obligations.
- Earnings Before Interest and Tax (EBIT)
- The EBIT figures also reflect a steady increase, climbing from roughly 1.73 billion in 2017 to nearly 2.93 billion in 2021. The increase in EBIT supports the trend of growing core operating profitability and suggests effective cost control or revenue expansion.
- Earnings Before Interest, Tax, Depreciation, and Amortization (EBITDA)
- EBITDA demonstrates consistent and significant growth from around 1.96 billion in 2017 to 3.25 billion in 2021. This upward trend indicates improved earnings capacity before non-cash charges, emphasizing strong operational performance and cash flow generation.
- Overall Analysis
- All key profitability metrics show a robust and continuous increase over the five-year span. The steady rise across net income, EBT, EBIT, and EBITDA indicates solid financial health and a company experiencing growth in earnings at multiple levels of the income statement. The data suggests effective management of operations, sustained revenue growth, and efficient cost structure leading to enhanced profitability.
Enterprise Value to EBITDA Ratio, Current
O’Reilly Automotive Inc., current EV/EBITDA calculation, comparison to benchmarks
| Selected Financial Data (US$ in thousands) | |
| Enterprise value (EV) | 55,622,513) |
| Earnings before interest, tax, depreciation and amortization (EBITDA) | 3,254,899) |
| Valuation Ratio | |
| EV/EBITDA | 17.09 |
| Benchmarks | |
| EV/EBITDA, Competitors1 | |
| Amazon.com Inc. | 19.91 |
| Home Depot Inc. | 18.49 |
| Lowe’s Cos. Inc. | 14.69 |
| TJX Cos. Inc. | 19.95 |
| EV/EBITDA, Sector | |
| Consumer Discretionary Distribution & Retail | 30.41 |
| EV/EBITDA, Industry | |
| Consumer Discretionary | 63.82 |
Based on: 10-K (reporting date: 2021-12-31).
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
O’Reilly Automotive Inc., historical EV/EBITDA calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Enterprise value (EV)1 | 46,704,845) | 35,063,126) | 31,466,172) | 32,224,896) | 23,363,639) | |
| Earnings before interest, tax, depreciation and amortization (EBITDA)2 | 3,254,899) | 2,742,166) | 2,201,179) | 2,075,153) | 1,962,998) | |
| Valuation Ratio | ||||||
| EV/EBITDA3 | 14.35 | 12.79 | 14.30 | 15.53 | 11.90 | |
| Benchmarks | ||||||
| EV/EBITDA, Competitors4 | ||||||
| Amazon.com Inc. | 21.27 | 32.24 | — | — | — | |
| Home Depot Inc. | 16.53 | 12.34 | — | — | — | |
| Lowe’s Cos. Inc. | 14.41 | 8.98 | — | — | — | |
| TJX Cos. Inc. | 65.35 | 10.33 | — | — | — | |
| EV/EBITDA, Sector | ||||||
| Consumer Discretionary Distribution & Retail | 20.16 | 24.23 | — | — | — | |
| EV/EBITDA, Industry | ||||||
| Consumer Discretionary | 21.51 | 29.73 | — | — | — | |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
3 2021 Calculation
EV/EBITDA = EV ÷ EBITDA
= 46,704,845 ÷ 3,254,899 = 14.35
4 Click competitor name to see calculations.
- Enterprise Value (EV)
- Over the five-year period, the enterprise value exhibited a general upward trajectory. Starting at approximately $23.36 billion at the end of 2017, EV increased consistently, reaching about $46.7 billion by the end of 2021. Notably, there was a steady rise each year, with the largest absolute increase occurring between 2020 and 2021.
- Earnings Before Interest, Tax, Depreciation, and Amortization (EBITDA)
- EBITDA showed a persistent positive growth trend throughout the observed timeframe. Beginning at roughly $1.96 billion in 2017, EBITDA rose moderately each year to around $3.25 billion by the end of 2021. The year 2020 experienced a more pronounced increase compared to previous years, which continued into 2021.
- EV/EBITDA Ratio
- The EV/EBITDA ratio demonstrated variability over the period rather than a clear linear trend. Initially, the ratio was 11.9 in 2017, increasing sharply to 15.53 in 2018. Thereafter, it slightly decreased to 14.3 in 2019 and continued a downward movement to 12.79 in 2020, before rising again to 14.35 in 2021. This fluctuation suggests variations in market valuation relative to operating earnings, with the ratio peaking in 2018 and stabilizing somewhat in subsequent years.