General Motors Co. (GM)

Enterprise Value to EBITDA (EV/EBITDA)

Difficulty: Intermediate

General Motors Co., EBITDA calculation

USD $ 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 stockholders
	Add: Net income attributable to noncontrolling interest
	Less: Loss from discontinued operations, net of tax
	Add: Income tax expense
	Earnings before tax (EBT)
	Add: Automotive interest expense
	Earnings before interest and tax (EBIT)
	Add: Depreciation and impairment of Equipment on operating leases, net
	Add: Depreciation, amortization and impairment charges on Property, net
	Add: Depreciation, amortization and impairment charges
	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.	General Motors Co.’s EBITDA increased from 2016 to 2017 but then slightly declined from 2017 to 2018 not reaching 2016 level.

General Motors 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
Ford Motor Co.
EV/EBITDA, Sector
Automobiles & Parts
EV/EBITDA, Industry
Consumer Goods

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.

General Motors Co., 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 (USD $ in millions)
	Enterprise value (EV)¹
	Earnings before interest, tax, depreciation and amortization (EBITDA)²
	Ratio
	EV/EBITDA³
	Benchmarks
	EV/EBITDA, Competitors
	Ford Motor Co.
	EV/EBITDA, Sector
	Automobiles & Parts
	EV/EBITDA, Industry
	Consumer Goods

2018 Calculations

³ EV/EBITDA = EV ÷ EBITDA
= hidden ÷ hidden = hidden

Ratio	Description	The company
EV/EBITDA	EV/EBITDA is a valuation indicator for the overall company rather than common stock.	General Motors Co.’s EV/EBITDA ratio increased from 2016 to 2017 and from 2017 to 2018.

	General Motors Co.	Other companies (not purchased previously)
Financial Statements
Common-Size Financial Statements
Ratios
Relative Valuation
Discounted Cash Flow (DCF) Valuation
Long-term Trends
Analysis
Financial Reporting Quality

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Financial Statements
Common-Size Financial Statements
Ratios
Relative Valuation
Discounted Cash Flow (DCF) Valuation
Long-term Trends
Analysis
Financial Reporting Quality