General Electric Co. (GE)

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)

General Electric Co., EBITDA calculation

US$ in millions

12 months ended	Dec 31, 2019	Dec 31, 2018	Dec 31, 2017	Dec 31, 2016	Dec 31, 2015
Net earnings (loss) attributable to the Company	(4,979)	(22,355)	(5,786)	8,831	(6,126)
Add: Net income attributable to noncontrolling interest	67	(88)	(270)	(291)	331
Less: Loss from discontinued operations, net of taxes	(5,335)	(1,726)	(308)	(954)	(7,495)
Add: Income tax expense	726	583	(3,043)	(464)	6,486
Earnings before tax (EBT)	1,149	(20,134)	(8,791)	9,030	8,186
Add: Interest and other financial charges	4,227	5,059	4,869	5,025	3,463
Earnings before interest and tax (EBIT)	5,376	(15,075)	(3,922)	14,055	11,649
Add: Depreciation and amortization of property, plant and equipment	4,026	5,562	5,139	4,997	4,847
Add: Amortization of intangible assets	1,569	2,662	—	—	—
Earnings before interest, tax, depreciation and amortization (EBITDA)	10,971	(6,851)	1,217	19,052	16,496

Based on: 10-K (filing date: 2020-02-24), 10-K (filing date: 2019-02-26), 10-K (filing date: 2018-02-23), 10-K (filing date: 2017-02-24), 10-K (filing date: 2016-02-26).

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.	General Electric Co.’s EBITDA decreased from 2017 to 2018 but then increased from 2018 to 2019 exceeding 2017 level.

Enterprise Value to EBITDA Ratio, Current

General Electric Co., current EV/EBITDA calculation, comparison to benchmarks

Selected Financial Data (US$ in millions)
Enterprise value (EV)	76,915
Earnings before interest, tax, depreciation and amortization (EBITDA)	10,971
Valuation Ratio
EV/EBITDA	7.01
Benchmarks
EV/EBITDA, Competitors¹
3M Co.	12.45
Danaher Corp.	21.68
Honeywell International Inc.	11.23
EV/EBITDA, Sector
General Industrials	11.58
EV/EBITDA, Industry
Industrials	11.63

Based on: 10-K (filing date: 2020-02-24).

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

General Electric Co., historical EV/EBITDA calculation, comparison to benchmarks

	Dec 31, 2019	Dec 31, 2018	Dec 31, 2017	Dec 31, 2016	Dec 31, 2015
Selected Financial Data (US$ in millions)
Enterprise value (EV)¹	111,177	154,405	196,136	308,838	372,010
Earnings before interest, tax, depreciation and amortization (EBITDA)²	10,971	(6,851)	1,217	19,052	16,496
Valuation Ratio
EV/EBITDA³	10.13	—	161.16	16.21	22.55
Benchmarks
EV/EBITDA, Competitors⁴
3M Co.	14.41	14.31	15.15	13.21	11.90
Danaher Corp.	25.23	18.47	17.93	17.88	15.88
Honeywell International Inc.	14.95	12.69	14.21	12.71	11.10
EV/EBITDA, Sector
General Industrials	14.65	30.71	22.96	15.02	16.94
EV/EBITDA, Industry
Industrials	15.26	15.02	15.26	13.29	11.89

Based on: 10-K (filing date: 2020-02-24), 10-K (filing date: 2019-02-26), 10-K (filing date: 2018-02-23), 10-K (filing date: 2017-02-24), 10-K (filing date: 2016-02-26).

¹ See details »

² See details »

³ 2019 Calculation
EV/EBITDA = EV ÷ EBITDA
= 111,177 ÷ 10,971 = 10.13

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.	General Electric Co.’s EV/EBITDA ratio decreased from 2017 to 2018 but then slightly increased from 2018 to 2019.