Fiat Industrial SpA (MIL:FI) Earnings Power Value (EPV) : €-6.30 (As of Jun13)

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What is Fiat Industrial SpA Earnings Power Value (EPV)?

As of Jun13, Fiat Industrial SpA's earnings power value is €-6.30. *

* GuruFocus does not store EPV value into our database if Average Maintenance CAPEX is 0.

Margin of Safety is N/A.

The basic concept of EPV is that one should value a stock based on the current free cash flow of a company and not on future projections which may, or may not, come true. It is arguably a better way to analyze stocks than Discounted Cash Flow analysis that relies on highly speculative growth assumptions many years into the future. Assumption: Current profitability is sustainable.

Fiat Industrial SpA Earnings Power Value (EPV) Historical Data

The historical data trend for Fiat Industrial SpA's Earnings Power Value (EPV) can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

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Fiat Industrial SpA Earnings Power Value (EPV) Chart

Fiat Industrial SpA Annual Data

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Earnings Power Value (EPV)

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Fiat Industrial SpA Quarterly Data
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Competitive Comparison of Fiat Industrial SpA's Earnings Power Value (EPV)

For the Farm & Heavy Construction Machinery subindustry, Fiat Industrial SpA's Earnings Power Value (EPV), along with its competitors' market caps and Earnings Power Value (EPV) data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

Fiat Industrial SpA's Earnings Power Value (EPV) Distribution in the Farm & Heavy Construction Machinery Industry

For the Farm & Heavy Construction Machinery industry and Industrials sector, Fiat Industrial SpA's Earnings Power Value (EPV) distribution charts can be found below:

* The bar in red indicates where Fiat Industrial SpA's Earnings Power Value (EPV) falls into.

Fiat Industrial SpA Earnings Power Value (EPV) Calculation

Earnings Power Value also known as just Earnings Power is a valuation technique popularised by Bruce Greenwald, an authority on value investing at Columbia University. It is arguably a better way to analyze stocks than Discounted Cash Flow analysis that relies on highly speculative growth assumptions many years into the future.

The basic concept of EPV is that one should value a stock based on the current free cash flow of a company and not on future projections which may, or may not, come true. This valuation tool excludes the potential growth that a company may have so that needs to be looked at separately. Since future growth is excluded from the analysis, only the maintenance capital expenditures are subtracted from after-tax EBIT (earnings before interest and taxes) and growth capex is ignored.

Fiat Industrial SpA (MIL:FI) Earnings Power Value (EPV) Explanation

Assumption: Current profitability is sustainable.

Earnings power value (EPV) uses a very basic equation which assumes no growth, although it does rely on an assumption about the cost of capital as well as the fact that current earnings are sustainable. It also involves several adjustments to clean up the underlying Earnings figures.

Be Aware

Though using today's earnings in calculating Earnings Power Value, GuruFocus is normalizing these earnings to the business cycle. This eliminates the effects on profitability of valuing the firm at different points in the business cycle. This means that we are considering the average earnings over 5 years.

Fiat Industrial SpA Earnings Power Value (EPV) Related Terms

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Fiat Industrial SpA (MIL:FI) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Industrials » Farm & Heavy Construction Machinery » Fiat Industrial SpA (MIL:FI) » Definitions » Earnings Power Value (EPV)

Traded in Other Exchanges

N/A

Address

Website

http://www.fiatindustrial.com

Fiat Industrial SpA operates in the capital goods sector. Each of the Group's businesses is a major international player in its respective industry sector: Iveco, CNH-Case New Holland and FPT Industrial. These three sectors design, produce and sell trucks, commercial vehicles, buses, special vehicles (Iveco), tractors, and agricultural and construction equipment (CNH), in addition to engines and transmissions for those vehicles and engines for marine applications (FPT Industrial). Agricultural equipment is sold under the New Holland Agriculture and Case IH and, in the premium segment in Europe, Steyr brands. Construction equipment is sold under the New Holland Construction and Case Construction brands, as well as the Kobelco brand in North America. Iveco designs, manufactures and sells a wide range of light (2.8-6 tons GVW), medium (6-16 tons GVW) and heavy (above 16 tons GVW) commercial vehicles for on-road and off-road use. In addition to its main product offer, the Company also offers after-sales and financing services, in addition to services related to used-vehicles. FPT Industrial is specialized in the design, production and sale of propulsion and transmission systems for on- and off-road trucks and commercial vehicles, as well as engines for marine application and power generation.