.Enterprise Value to EBITDA (EV/EBITDA)
Difficulty: Intermediate
Earnings before Interest, Tax, Depreciation and Amortization (EBITDA)
Boeing Co., EBITDA calculation
USD $ in millions
| 12 months ended | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | Dec 31, 2014 | Dec 31, 2013 | |
|---|---|---|---|---|---|---|
| | Net earnings related to parent | |||||
| | Add: Net income attributable to noncontrolling interest | |||||
| | Less: Net loss on disposal of discontinued operations, net of taxes | |||||
| | Add: Income tax expense | |||||
| | Earnings before tax (EBT) | |||||
| | Add: Interest and debt expense | |||||
| | Earnings before interest and tax (EBIT) | |||||
| | Add: Depreciation and amortization | |||||
| | Earnings before interest, tax, depreciation and amortization (EBITDA) |
| 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. | Boeing Co.'s EBITDA declined from 2015 to 2016 but then increased from 2016 to 2017 exceeding 2015 level. |
Enterprise Value to EBITDA Ratio, Current
Boeing Co., current EV/EBITDA calculation, comparison to benchmarks
| Selected Financial Data (USD $ in millions) | |
| Enterprise value (EV) | |
| Earnings before interest, tax, depreciation and amortization (EBITDA) | |
| Ratio | |
| EV/EBITDA | |
| Benchmarks | |
| EV/EBITDA, Competitors | |
| General Dynamics Corp. | |
| Lockheed Martin Corp. | |
| Northrop Grumman Corp. | |
| Raytheon Co. | |
| United Technologies Corp. | |
| EV/EBITDA, Sector | |
| Aerospace & Defense | |
| EV/EBITDA, Industry | |
| Industrials | |
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
Boeing Co., historical EV/EBITDA calculation, comparison to benchmarks
| 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 | |||||
| | Earnings before interest, tax, depreciation and amortization (EBITDA)2 | |||||
| Ratio | ||||||
| | EV/EBITDA3 | |||||
| Benchmarks | ||||||
| EV/EBITDA, Competitors | ||||||
| General Dynamics Corp. | ||||||
| Lockheed Martin Corp. | ||||||
| Northrop Grumman Corp. | ||||||
| Raytheon Co. | ||||||
| United Technologies Corp. | ||||||
| EV/EBITDA, Sector | ||||||
| Aerospace & Defense | ||||||
| EV/EBITDA, Industry | ||||||
| Industrials | ||||||
2017 Calculations
3 EV/EBITDA = EV ÷ EBITDA
= ÷ =
| Ratio | Description | The company |
|---|---|---|
| EV/EBITDA | EV/EBITDA is a valuation indicator for the overall company rather than common stock. | Boeing Co.'s EV/EBITDA ratio increased from 2015 to 2016 and from 2016 to 2017. |
