Microsoft Excel LibreOffice Calc

Enterprise Value to EBITDA (EV/EBITDA)

Difficulty: Intermediate


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

Altria Group Inc., EBITDA calculation

USD $ in millions

Microsoft Excel LibreOffice Calc
12 months ended Dec 31, 2017 Dec 31, 2016 Dec 31, 2015 Dec 31, 2014 Dec 31, 2013
Net earnings attributable to Altria Group, Inc. 10,222  14,239  5,241  5,070  4,535 
Add: Net income attributable to noncontrolling interest
Add: Income tax expense (399) 7,608  2,835  2,704  2,407 
Earnings before tax (EBT) 9,828  21,852  8,078  7,774  6,942 
Add: Interest expense 727  754  808  857  1,053 
Earnings before interest and tax (EBIT) 10,555  22,606  8,886  8,631  7,995 
Add: Depreciation and amortization 209  204  225  208  212 
Earnings before interest, tax, depreciation and amortization (EBITDA) 10,764  22,810  9,111  8,839  8,207 
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. Altria Group Inc.'s EBITDA increased from 2015 to 2016 but then slightly declined from 2016 to 2017 not reaching 2015 level.

Enterprise Value to EBITDA Ratio, Current

Altria Group Inc., current EV/EBITDA calculation, comparison to benchmarks

Microsoft Excel LibreOffice Calc
Selected Financial Data (USD $ in millions)
Enterprise value (EV) 127,093 
Earnings before interest, tax, depreciation and amortization (EBITDA) 10,764 
Ratio
EV/EBITDA 11.81
Benchmarks
EV/EBITDA, Competitors
Philip Morris International Inc. 12.04
EV/EBITDA, Sector
Tobacco 11.93
EV/EBITDA, Industry
Consumer Goods 11.79

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

Altria Group 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 millions)
Enterprise value (EV)1 134,273  153,976  132,679  120,941  81,968 
Earnings before interest, tax, depreciation and amortization (EBITDA)2 10,764  22,810  9,111  8,839  8,207 
Ratio
EV/EBITDA3 12.47 6.75 14.56 13.68 9.99
Benchmarks
EV/EBITDA, Competitors
Philip Morris International Inc. 14.88 15.70 14.49 12.30 10.49
EV/EBITDA, Sector
Tobacco 13.77 9.81 14.52 12.87 10.31
EV/EBITDA, Industry
Consumer Goods 12.30 11.84 12.68 13.08 10.91

2017 Calculations

3 EV/EBITDA = EV ÷ EBITDA
= 134,273 ÷ 10,764 = 12.47

Ratio Description The company
EV/EBITDA EV/EBITDA is a valuation indicator for the overall company rather than common stock. Altria Group Inc.'s EV/EBITDA ratio declined from 2015 to 2016 but then increased from 2016 to 2017 not reaching 2015 level.