Enterprise Value to EBITDA (EV/EBITDA)
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- Balance Sheet: Assets
- Balance Sheet: Liabilities and Stockholders’ Equity
- Analysis of Liquidity Ratios
- Analysis of Short-term (Operating) Activity Ratios
- Analysis of Long-term (Investment) Activity Ratios
- Common Stock Valuation Ratios
- Enterprise Value to FCFF (EV/FCFF)
- Selected Financial Data since 2005
- Net Profit Margin since 2005
- Analysis of Revenues
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Earnings before Interest, Tax, Depreciation and Amortization (EBITDA)
Builders FirstSource Inc., EBITDA calculation
US$ in thousands
Based on: 10-K (reporting date: 2022-12-31), 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).
The financial data reveals a strong growth trajectory over the five-year period analyzed. Key profitability metrics, including net income, earnings before tax (EBT), earnings before interest and tax (EBIT), and earnings before interest, tax, depreciation, and amortization (EBITDA), demonstrate substantial increases from 2018 to 2022.
- Net Income
- Net income shows a steady increase from 205,191 thousand USD in 2018 to 313,537 thousand USD in 2020, followed by a significant jump to 1,725,416 thousand USD in 2021 and a further rise to 2,749,369 thousand USD in 2022. This indicates a marked improvement in the company’s bottom-line profitability, especially in the last two years.
- Earnings Before Tax (EBT)
- EBT follows a similar upward trend, rising from 260,755 thousand USD in 2018 to 408,166 thousand USD in 2020, then sharply increasing to 2,251,547 thousand USD in 2021 and 3,571,833 thousand USD in 2022. The growth in EBT aligns with the increase in net income, suggesting higher operating profitability and/or improved non-operating results.
- Earnings Before Interest and Tax (EBIT)
- EBIT also exhibits substantial growth, moving from 368,968 thousand USD in 2018 to 543,854 thousand USD in 2020, followed by a large increase to 2,387,424 thousand USD in 2021 and 3,770,206 thousand USD in 2022. This upward trend highlights enhanced operational efficiency or increased revenue generation at the core business level.
- Earnings Before Interest, Tax, Depreciation, and Amortization (EBITDA)
- EBITDA, reflecting cash earnings from operating activities, increased consistently from 466,874 thousand USD in 2018 to 660,420 thousand USD in 2020. The figures then jump dramatically to 2,934,776 thousand USD in 2021 and 4,267,346 thousand USD in 2022, which underscores strong operational cash flows and improved profitability potential.
Overall, the data reflects a pattern of accelerating profitability, with all key earnings metrics nearly quadrupling or more between 2020 and 2022. The years 2021 and 2022 stand out with exceptionally strong gains, suggesting either substantial growth in sales, significant improvements in cost management, one-time events, or a combination thereof. The consistent increase across all levels of earnings suggests a healthy and expanding business operation.
Enterprise Value to EBITDA Ratio, Current
Builders FirstSource Inc., current EV/EBITDA calculation, comparison to benchmarks
| Selected Financial Data (US$ in thousands) | |
| Enterprise value (EV) | |
| Earnings before interest, tax, depreciation and amortization (EBITDA) | |
| Valuation Ratio | |
| EV/EBITDA | |
| Benchmarks | |
| EV/EBITDA, Competitors1 | |
| Boeing Co. | |
| Caterpillar Inc. | |
| Eaton Corp. plc | |
| GE Aerospace | |
| Honeywell International Inc. | |
| Lockheed Martin Corp. | |
| RTX Corp. | |
| EV/EBITDA, Sector | |
| Capital Goods | |
| EV/EBITDA, Industry | |
| Industrials | |
Based on: 10-K (reporting date: 2022-12-31).
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
Builders FirstSource Inc., historical EV/EBITDA calculation, comparison to benchmarks
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Enterprise value (EV)1 | ||||||
| Earnings before interest, tax, depreciation and amortization (EBITDA)2 | ||||||
| Valuation Ratio | ||||||
| EV/EBITDA3 | ||||||
| Benchmarks | ||||||
| EV/EBITDA, Competitors4 | ||||||
| Boeing Co. | ||||||
| Caterpillar Inc. | ||||||
| Eaton Corp. plc | ||||||
| GE Aerospace | ||||||
| Honeywell International Inc. | ||||||
| Lockheed Martin Corp. | ||||||
| RTX Corp. | ||||||
| EV/EBITDA, Sector | ||||||
| Capital Goods | ||||||
| EV/EBITDA, Industry | ||||||
| Industrials | ||||||
Based on: 10-K (reporting date: 2022-12-31), 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).
3 2022 Calculation
EV/EBITDA = EV ÷ EBITDA
= ÷ =
4 Click competitor name to see calculations.
- Enterprise Value (EV)
- The enterprise value has exhibited a substantial upward trend over the five-year period. It increased from approximately 3.17 billion US dollars at the end of 2018 to a peak of about 15.8 billion US dollars in 2021. However, in 2022, there was a slight decline to approximately 14.6 billion US dollars, indicating a modest contraction after several years of growth.
- Earnings Before Interest, Tax, Depreciation and Amortization (EBITDA)
- EBITDA showed a consistent rise in the initial years, moving from around 467 million US dollars in 2018 to 660 million US dollars in 2020. This was followed by a significant acceleration in 2021, reaching nearly 2.93 billion US dollars. The upward momentum continued sharply into 2022, with EBITDA increasing further to approximately 4.27 billion US dollars. This pattern suggests strong operational performance and improved earnings generation capacity over the period.
- EV/EBITDA Ratio
- The EV/EBITDA ratio illustrates a fluctuating but overall declining pattern. Starting at 6.79 at the end of 2018, it increased to a peak of 15.34 in 2020, suggesting heightened valuation relative to earnings during that year. From 2021 onwards, the ratio decreased significantly to 5.38 and further to 3.42 in 2022. This reduction is consistent with the faster growth in EBITDA relative to enterprise value, pointing to an improvement in earnings efficiency or a possible market reassessment of valuation multiples.