ConocoPhillips (COP)

Enterprise Value to EBITDA (EV/EBITDA)

Intermediate level

Earnings before Interest, Tax, Depreciation and Amortization (EBITDA)
EV to EBITDA Ratio, Current
EV to EBITDA Ratio, Historical

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

ConocoPhillips, EBITDA calculation

US$ in millions

12 months ended	Dec 31, 2018	Dec 31, 2017	Dec 31, 2016	Dec 31, 2015	Dec 31, 2014
Net income (loss) attributable to ConocoPhillips	6,257	(855)	(3,615)	(4,428)	6,869
Add: Net income attributable to noncontrolling interest	48	62	56	57	69
Less: Income from discontinued operations	—	—	—	—	1,131
Add: Income tax expense	3,668	(1,822)	(1,971)	(2,868)	3,583
Earnings before tax (EBT)	9,973	(2,615)	(5,530)	(7,239)	9,390
Add: Interest and debt expense	735	1,098	1,245	920	648
Earnings before interest and tax (EBIT)	10,708	(1,517)	(4,285)	(6,319)	10,038
Add: Depreciation, depletion and amortization	5,956	6,845	9,062	9,113	8,329
Earnings before interest, tax, depreciation and amortization (EBITDA)	16,664	5,328	4,777	2,794	18,367

Based on: 10-K (filing date: 2019-02-19), 10-K (filing date: 2018-02-20), 10-K (filing date: 2017-02-21), 10-K (filing date: 2016-02-23), 10-K (filing date: 2015-02-24).

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.	ConocoPhillips’s EBITDA increased from 2016 to 2017 and from 2017 to 2018.

Enterprise Value to EBITDA Ratio, Current

ConocoPhillips, current EV/EBITDA calculation, comparison to benchmarks

Selected Financial Data (US$ in millions)
Enterprise value (EV)	76,607
Earnings before interest, tax, depreciation and amortization (EBITDA)	16,664
Valuation Ratio
EV/EBITDA	4.60
Benchmarks
EV/EBITDA, Competitors¹
Chevron Corp.	5.86
EOG Resources Inc.	6.67
Exxon Mobil Corp.	6.46
Phillips 66	6.01
EV/EBITDA, Sector
Oil & Gas Producers	5.99
EV/EBITDA, Industry
Oil & Gas	6.47

Based on: 10-K (filing date: 2019-02-19).

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

ConocoPhillips, 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	86,298	74,214	83,348	63,528	100,484
Earnings before interest, tax, depreciation and amortization (EBITDA)²	16,664	5,328	4,777	2,794	18,367
Valuation Ratio
EV/EBITDA³	5.18	13.93	17.45	22.74	5.47
Benchmarks
EV/EBITDA, Competitors⁴
Chevron Corp.	6.19	8.49	14.31	7.31	4.58
EOG Resources Inc.	7.45	15.52	27.16	—	6.10
Exxon Mobil Corp.	7.49	9.37	12.40	9.41	5.88
Phillips 66	5.90	10.42	13.39	6.58	6.56
EV/EBITDA, Sector
Oil & Gas Producers	6.64	9.74	14.01	9.92	5.47
EV/EBITDA, Industry
Oil & Gas	7.07	10.89	15.52	10.42	6.28

Based on: 10-K (filing date: 2019-02-19), 10-K (filing date: 2018-02-20), 10-K (filing date: 2017-02-21), 10-K (filing date: 2016-02-23), 10-K (filing date: 2015-02-24).

¹ See details »

² See details »

³ 2018 Calculation
EV/EBITDA = EV ÷ EBITDA
= 86,298 ÷ 16,664 = 5.18

⁴ Click competitor name to see calculations.

Valuation ratio	Description	The company
EV/EBITDA	Enterprise value to earnings before interest, tax, depreciation and amortization is a valuation indicator for the overall company rather than common stock.	ConocoPhillips’s EV/EBITDA ratio decreased from 2016 to 2017 and from 2017 to 2018.