Enterprise Value to EBITDA (EV/EBITDA)
Earnings before Interest, Tax, Depreciation and Amortization (EBITDA)
GE Aerospace, EBITDA calculation
US$ in millions
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
The financial performance exhibits significant fluctuations over the five-year period under review. The net earnings show a pronounced volatility, beginning with a strong profit in 2020, followed by a substantial loss in 2021, a modest recovery in 2022, and a return to higher profitability in the subsequent years. Specifically, net earnings dropped from a profit of 5,704 million USD in 2020 to a loss of 6,520 million USD in 2021, then rebounded to positive territory with 225 million USD in 2022, reaching a peak of 9,481 million USD in 2023 before moderating to 6,556 million USD in 2024.
- Earnings before tax (EBT)
- EBT followed a broadly similar pattern to net earnings, with a loss in 2021 interrupting the otherwise positive trend. After declining from 5,197 million USD in 2020 to a loss of 3,683 million USD in 2021, EBT moved back into positive figures in 2022, rising sharply to 1,412 million USD and increasing further to a peak of 10,191 million USD in 2023 before slightly decreasing to 7,620 million USD in 2024.
- Earnings before interest and tax (EBIT)
- EBIT demonstrated a comparable trend but with less volatility than net earnings and EBT. The metric dropped from a high of 8,470 million USD in 2020 to a negative figure of -1,807 million USD in 2021, then recovered strongly to 3,019 million USD in 2022 and subsequently reached its highest levels across the period in 2023 (11,309 million USD) before easing to 8,606 million USD in 2024. This pattern signals a significant operational setback in 2021 with a swift recovery and robust operational profitability thereafter.
- Earnings before interest, tax, depreciation, and amortization (EBITDA)
- The EBITDA metric appears more resilient compared to others during the downturn in 2021, declining from 14,488 million USD in 2020 to 1,202 million USD in 2021, which, while still a steep fall, remained positive. EBITDA rose notably to 6,563 million USD in 2022 and reached a high of 13,388 million USD in 2023 before falling to 9,790 million USD in 2024. This suggests that cash generation capacity remained positive even during the worst year and improved markedly in the following years.
Overall, the financial data reveals a period of marked instability in 2021, followed by recovery and growth through 2023. The sharp turnaround in profitability and earnings metrics after 2021 denotes successful operational adjustments or market improvements. The decline in 2024 compared to 2023 across all profitability measures indicates a potential tempering of growth but the company remains profitable with earnings well above the mid-cycle troughs. The consistent relation between EBIT and EBITDA trends suggests stable control over operating expenses once the crisis in 2021 was addressed.
Enterprise Value to EBITDA Ratio, Current
GE Aerospace, current EV/EBITDA calculation, comparison to benchmarks
| Selected Financial Data (US$ in millions) | |
| Enterprise value (EV) | 271,843) |
| Earnings before interest, tax, depreciation and amortization (EBITDA) | 9,790) |
| Valuation Ratio | |
| EV/EBITDA | 27.77 |
| Benchmarks | |
| EV/EBITDA, Competitors1 | |
| Boeing Co. | — |
| Caterpillar Inc. | 13.74 |
| Eaton Corp. plc | 26.33 |
| Honeywell International Inc. | 18.13 |
| Lockheed Martin Corp. | 14.33 |
| RTX Corp. | 18.58 |
| EV/EBITDA, Sector | |
| Capital Goods | 25.05 |
| EV/EBITDA, Industry | |
| Industrials | 18.88 |
Based on: 10-K (reporting date: 2024-12-31).
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
GE Aerospace, historical EV/EBITDA calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Enterprise value (EV)1 | 223,963) | 148,093) | 97,249) | 114,873) | 135,492) | |
| Earnings before interest, tax, depreciation and amortization (EBITDA)2 | 9,790) | 13,388) | 6,563) | 1,202) | 14,488) | |
| Valuation Ratio | ||||||
| EV/EBITDA3 | 22.88 | 11.06 | 14.82 | 95.57 | 9.35 | |
| Benchmarks | ||||||
| EV/EBITDA, Competitors4 | ||||||
| Boeing Co. | — | 71.32 | — | — | — | |
| Caterpillar Inc. | 12.46 | 12.16 | 13.86 | 12.43 | 19.87 | |
| Eaton Corp. plc | 21.53 | 24.91 | 19.18 | 17.06 | 22.11 | |
| Honeywell International Inc. | 15.87 | 15.55 | 18.01 | 15.57 | 20.21 | |
| Lockheed Martin Corp. | 14.23 | 11.71 | 14.98 | 11.97 | 9.97 | |
| RTX Corp. | 16.80 | 16.62 | 14.92 | 15.48 | 41.71 | |
| EV/EBITDA, Sector | ||||||
| Capital Goods | 21.78 | 16.03 | 19.01 | 19.87 | 25.02 | |
| EV/EBITDA, Industry | ||||||
| Industrials | 17.18 | 14.82 | 16.44 | 16.30 | 30.80 | |
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
3 2024 Calculation
EV/EBITDA = EV ÷ EBITDA
= 223,963 ÷ 9,790 = 22.88
4 Click competitor name to see calculations.
The financial data reveals distinct fluctuations in both enterprise value and EBITDA over the five-year period, resulting in notable variations in the EV/EBITDA ratio.
- Enterprise Value (EV)
- The enterprise value exhibits an overall volatile trend. Starting at approximately US$135.5 billion in 2020, it decreased to around US$97.2 billion by the end of 2022. This was followed by a significant increase in subsequent years, reaching about US$148.1 billion in 2023 and sharply rising to US$224.0 billion in 2024. This pattern suggests periods of market value contraction followed by expansion, which may be influenced by external factors such as market conditions or strategic company decisions.
- EBITDA
- EBITDA decreased drastically from US$14.5 billion in 2020 to a low of approximately US$1.2 billion in 2021. This was followed by a recovery to US$6.6 billion in 2022 and further growth to US$13.4 billion by 2023. However, in 2024, EBITDA declined again to around US$9.8 billion. This fluctuation indicates significant variability in the company's operating performance, possibly reflecting operational challenges, restructuring efforts, or sector-specific influences.
- EV/EBITDA Ratio
- The EV/EBITDA ratio shows highly erratic behavior corresponding to the changes in EV and EBITDA. The ratio was relatively moderate at 9.35 in 2020, then surged dramatically to 95.57 in 2021 due to the steep drop in EBITDA. It normalized to 14.82 in 2022 and further decreased to 11.06 in 2023 as EBITDA improved while EV also increased. In 2024, the ratio increased substantially to 22.88, reflecting the sharp rise in EV coupled with a decline in EBITDA. The wide variation in this ratio over time indicates changing market perceptions of value and operating profitability fluctuations.