Stock Analysis on Net
Stock Analysis on Net
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Raytheon Technologies Corp. (NYSE:RTX)

Enterprise Value to EBITDA (EV/EBITDA)

Intermediate level

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

Raytheon Technologies Corp., EBITDA calculation

US$ in millions

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12 months ended: Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015
Net income attributable to common shareowners 5,537  5,269  4,552  5,055  7,608 
Add: Net income attributable to noncontrolling interest 411  385  368  371  358 
Less: Net income (loss) from discontinued operations —  —  —  (10) 3,610 
Add: Income tax expense 2,295  2,626  2,843  1,697  2,111 
Earnings before tax (EBT) 8,243  8,280  7,763  7,133  6,467 
Add: Interest expense 1,773  1,225  1,017  1,161  945 
Earnings before interest and tax (EBIT) 10,016  9,505  8,780  8,294  7,412 
Add: Depreciation and amortization 3,783  2,433  2,140  1,962  1,863 
Earnings before interest, tax, depreciation and amortization (EBITDA) 13,799  11,938  10,920  10,256  9,275 

Based on: 10-K (filing date: 2020-02-06), 10-K (filing date: 2019-02-07), 10-K (filing date: 2018-02-09), 10-K (filing date: 2017-02-09), 10-K (filing date: 2016-02-11).

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. Raytheon Technologies Corp.’s EBITDA increased from 2017 to 2018 and from 2018 to 2019.

Enterprise Value to EBITDA Ratio, Current

Raytheon Technologies Corp., current EV/EBITDA calculation, comparison to benchmarks

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Selected Financial Data (US$ in millions)
Enterprise value (EV) 150,823 
Earnings before interest, tax, depreciation and amortization (EBITDA) 13,799 
Valuation Ratio
EV/EBITDA 10.93
Benchmarks
EV/EBITDA, Competitors1
Boeing Co. 202.65
General Dynamics Corp. 9.93
Lockheed Martin Corp. 12.89
Northrop Grumman Corp. 14.67
EV/EBITDA, Sector
Aerospace & Defense 15.76
EV/EBITDA, Industry
Industrials 15.74

Based on: 10-K (filing date: 2020-02-06).

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

Raytheon Technologies Corp., historical EV/EBITDA calculation, comparison to benchmarks

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Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015
Selected Financial Data (US$ in millions)
Enterprise value (EV)1 173,888  145,579  120,307  107,051  85,648 
Earnings before interest, tax, depreciation and amortization (EBITDA)2 13,799  11,938  10,920  10,256  9,275 
Valuation Ratio
EV/EBITDA3 12.60 12.19 11.02 10.44 9.23
Benchmarks
EV/EBITDA, Competitors4
Boeing Co. 284.02 16.52 16.31 12.89 8.11
General Dynamics Corp. 11.81 11.77 13.64 11.91 8.92
Lockheed Martin Corp. 14.86 12.86 15.32 12.94 12.38
Northrop Grumman Corp. 17.54 11.68 16.21 12.12 10.78
EV/EBITDA, Sector
Aerospace & Defense 19.36 13.59 14.32 11.92 9.65
EV/EBITDA, Industry
Industrials 15.05 14.86 14.99 13.09 11.86

Based on: 10-K (filing date: 2020-02-06), 10-K (filing date: 2019-02-07), 10-K (filing date: 2018-02-09), 10-K (filing date: 2017-02-09), 10-K (filing date: 2016-02-11).

1 See details »

2 See details »

3 2019 Calculation
EV/EBITDA = EV ÷ EBITDA
= 173,888 ÷ 13,799 = 12.60

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. Raytheon Technologies Corp.’s EV/EBITDA ratio increased from 2017 to 2018 and from 2018 to 2019.