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GuruFocus has detected 7 Warning Signs with Humana Inc $HUM.
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Humana Inc (NYSE:HUM)
Enterprise Value
$22,575 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, Humana Inc's enterprise value is $22,575 Mil. Humana Inc's earnings before interest and taxes (EBIT) for the trailing twelve months (TTM) ended in Dec. 2016 was $1,741 Mil. Therefore, Humana Inc's EV/EBIT ratio for today is 12.97.

EV/EBITDA ratio is calculated as enterprise value divided by its EBITDA. As of today, Humana Inc's enterprise value is $22,575 Mil. Humana Inc's earnings before depreciation and amortization for the trailing twelve months (TTM) ended in Dec. 2016 was $2,206 Mil. Therefore, Humana Inc's EV/EBITDA ratio for today is 10.23.

EV/Revenue ratio is calculated as enterprise value divided by its Revenue. As of today, Humana Inc's enterprise value is $22,575 Mil. Humana Inc's revenue for the trailing twelve months (TTM) ended in Dec. 2016 was $54,379 Mil. Therefore, Humana Inc's EV/Revenue ratio for today is 0.42.


Definition

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

Humana Inc's Enterprise Value for the fiscal year that ended in Dec. 2016 is calculated as

Enterprise Value (A: Dec. 2016 )
=Market Cap+Preferred Stock+Long-Term Debt & Capital Lease Obligation
=30463.7193+0+3792
+Current Portion of Long-Term Debt+Minority Interest-Cash and Cash Equivalents
+512+0-11472
=23,296

Humana Inc's Enterprise Value for the quarter that ended in Dec. 2016 is calculated as

Enterprise Value (Q: Dec. 2016 )
=Market Cap+Preferred Stock+Long-Term Debt & Capital Lease Obligation
=30463.7193+0+3792
+Current Portion of Long-Term Debt+Minority Interest-Cash and Cash Equivalents
+512+0-11472
=23,296

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's 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.

Humana Inc's EV/EBIT for today is

Humana Inc's current Enterprise Value is $22,575 Mil.
Humana Inc's Earnings Before Interest and Taxes (EBIT) for the trailing twelve months (TTM) ended in Dec. 2016 was 547 (Mar. 2016 ) + 683 (Jun. 2016 ) + 949 (Sep. 2016 ) + -438 (Dec. 2016 ) = $1,741 Mil.

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

Humana Inc's EV/EBITDA for today is:

Humana Inc's current Enterprise Value is $22,575 Mil.
Humana Inc's Earnings Before Depreciation and Amortization for the trailing twelve months (TTM) ended in Dec. 2016 was 662 (Mar. 2016 ) + 799 (Jun. 2016 ) + 1066 (Sep. 2016 ) + -321 (Dec. 2016 ) = $2,206 Mil.

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

Humana Inc's EV/Revenue for today is:

EV/Revenue ratio=Enterprise Value (Today)/Revenue (TTM)
=22574.806/54379
=0.42

Humana Inc's current Enterprise Value is $22,575 Mil.
Humana Inc's Earnings Before Depreciation and Amortization for the trailing twelve months (TTM) ended in Dec. 2016 was 13800 (Mar. 2016 ) + 14007 (Jun. 2016 ) + 13694 (Sep. 2016 ) + 12878 (Dec. 2016 ) = $54,379 Mil.

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.


Related Terms

Market Cap, Preferred Stock, Long-Term Debt & Capital Lease Obligation, Cash and Cash Equivalents, Current Portion of Long-Term Debt


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

Humana Inc Annual Data

Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15Dec16
ev 9,0972,2771,7182,7537,2134,4949,67416,11321,05423,296

Humana Inc Quarterly Data

Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16Dec16
ev 13,78916,11321,23023,47721,64021,05421,07821,25416,55123,296
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