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Hormel Foods Corp (NYSE:HRL)
Enterprise Value
$13,861 Mil (As of Today)

Think of enterprise value as the theoretical takeover price. It is more comprehensive than market capitalization (market cap), which only includes common equity. Enterprise Value is calculated as the market cap plus debt and minority interest and preferred shares, minus total cash and cash equivalents.

EV/EBIT ratio is calculated as enterprise value divided by its EBIT. As of today, Hormel Foods Corp's enterprise value is $13,861 Mil. Hormel Foods Corp's operating income for the trailing twelve months (TTM) ended in Oct. 2014 was $927 Mil. Therefore, Hormel Foods Corp's EV/EBIT ratio for today is 14.95.

EV/EBITDA ratio is calculated as enterprise value divided by its EBITDA. As of today, Hormel Foods Corp's enterprise value is $13,861 Mil. Hormel Foods Corp's earnings before depreciation and amortization for the trailing twelve months (TTM) ended in Oct. 2014 was $1,065 Mil. Therefore, Hormel Foods Corp's EV/EBITDA ratio for today is 13.02.

EV/Revenue ratio is calculated as enterprise value divided by its Revenue. As of today, Hormel Foods Corp's enterprise value is $13,861 Mil. Hormel Foods Corp's revenue for the trailing twelve months (TTM) ended in Oct. 2014 was $9,316 Mil. Therefore, Hormel Foods Corp's EV/Revenue ratio for today is 1.49.


Definition

Enterprise Value is calculated as the market cap plus debt and minority interest and preferred shares, minus total cash and cash equivalents.

Hormel Foods Corp's Enterprise Value for the fiscal year that ended in Oct. 2014 is calculated as

Enterprise Value (A: Oct. 2014 )
=Market Cap+Preferred Stock+Long-Term Debt
=14066.1294+0+250
+Short-Term Debt Without Lease+Minority Interest-Cash and Cash Equivalents
+0+0-334.174
=13,982

Hormel Foods Corp's Enterprise Value for the quarter that ended in Oct. 2014 is calculated as

Enterprise Value (Q: Oct. 2014 )
=Market Cap+Preferred Stock+Long-Term Debt
=14066.1294+0+250
+Short-Term Debt Without Lease+Minority Interest-Cash and Cash Equivalents
+0+0-334.174
=13,982

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.


Explanation

When an investor buy a company, the investor needs to pay not only the common shares, he/she also needs to pay the shareholders of Preferred Stocks. He also assumes the debt of the company, and receives the cash on the company's balance sheet.

If a company has more cash than debt, the investor actually pays less than the Market Cap because he immediately owns the cash once the transaction goes through.

The market value of Preferred Stock needs to be added to the market value of common stocks in the calculation of enterprise value.

For the companies with the same Market Cap, the smaller the Enterprise Value is, the cheaper the company is.

Enterprise Value can be negative when the company's net cash is more than its Market Cap. In this case the investor is basically getting the company for free and get paid for that.

1. EV/EBIT ratio is calculated as enterprise value divided by its EBIT.

Hormel Foods Corp's EV/EBIT for today is

EV/EBIT ratio=Enterprise Value (Today)/Operating Income (TTM)
=13860.526/926.881
=14.95

Hormel Foods Corp's current Enterprise Value is $13,861 Mil.
Hormel Foods Corp's Operating Income for the trailing twelve months (TTM) ended in Oct. 2014 was 232.453 (Jan. 2014 ) + 216.556 (Apr. 2014 ) + 214.504 (Jul. 2014 ) + 263.368 (Oct. 2014 ) = $927 Mil.

2. EV/EBITDA ratio is calculated as enterprise value divided by its EBITDA.

Hormel Foods Corp's EV/EBITDA for today is:

Hormel Foods Corp's current Enterprise Value is $13,861 Mil.
Hormel Foods Corp's Earnings Before Depreciation and Amortization for the trailing twelve months (TTM) ended in Oct. 2014 was 270.125 (Jan. 2014 ) + 248.174 (Apr. 2014 ) + 249.557 (Jul. 2014 ) + 297.044 (Oct. 2014 ) = $1,065 Mil.

3. EV/Revenue ratio is calculated as enterprise value divided by its Revenue.

Hormel Foods Corp's EV/Revenue for today is:

EV/Revenue ratio=Enterprise Value (Today)/Revenue (TTM)
=13860.526/9316.256
=1.49

Hormel Foods Corp's current Enterprise Value is $13,861 Mil.
Hormel Foods Corp's Earnings Before Depreciation and Amortization for the trailing twelve months (TTM) ended in Oct. 2014 was 2242.672 (Jan. 2014 ) + 2244.866 (Apr. 2014 ) + 2284.947 (Jul. 2014 ) + 2543.771 (Oct. 2014 ) = $9,316 Mil.

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.


Related Terms

Market Cap, Preferred Stock, Long-Term Debt, Cash and Cash Equivalents


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

Hormel Foods Corp Annual Data

Oct05Oct06Oct07Oct08Oct09Oct10Oct11Oct12Oct13Oct14
ev 4,5715,1615,2514,1054,8365,9447,4937,26311,28013,982

Hormel Foods Corp Quarterly Data

Jul12Oct12Jan13Apr13Jul13Oct13Jan14Apr14Jul14Oct14
ev 6,9947,2638,53010,92911,11111,28011,61012,34511,93713,982
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