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GuruFocus has detected 4 Warning Signs with The Western Union Co $WU.
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The Western Union Co (NYSE:WU)
Enterprise Value
$10,357 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, The Western Union Co's enterprise value is $10,357 Mil. The Western Union Co's earnings before interest and taxes (EBIT) for the trailing twelve months (TTM) ended in Dec. 2016 was $494 Mil. Therefore, The Western Union Co's EV/EBIT ratio for today is 20.96.

EV/EBITDA ratio is calculated as enterprise value divided by its EBITDA. As of today, The Western Union Co's enterprise value is $10,357 Mil. The Western Union Co's earnings before depreciation and amortization for the trailing twelve months (TTM) ended in Dec. 2016 was $757 Mil. Therefore, The Western Union Co's EV/EBITDA ratio for today is 13.67.

EV/Revenue ratio is calculated as enterprise value divided by its Revenue. As of today, The Western Union Co's enterprise value is $10,357 Mil. The Western Union Co's revenue for the trailing twelve months (TTM) ended in Dec. 2016 was $5,423 Mil. Therefore, The Western Union Co's EV/Revenue ratio for today is 1.91.


Definition

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

The Western Union Co'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
=10458.18+0+2286.1
+Current Portion of Long-Term Debt+Minority Interest-Cash and Cash Equivalents
+500+0-2109.3
=11,135

The Western Union Co'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
=10458.18+0+2286.1
+Current Portion of Long-Term Debt+Minority Interest-Cash and Cash Equivalents
+500+0-2109.3
=11,135

* 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.

The Western Union Co's EV/EBIT for today is

The Western Union Co's current Enterprise Value is $10,357 Mil.
The Western Union Co's Earnings Before Interest and Taxes (EBIT) for the trailing twelve months (TTM) ended in Dec. 2016 was 258 (Mar. 2016 ) + 263.5 (Jun. 2016 ) + 281.4 (Sep. 2016 ) + -308.7 (Dec. 2016 ) = $494 Mil.

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

The Western Union Co's EV/EBITDA for today is:

The Western Union Co's current Enterprise Value is $10,357 Mil.
The Western Union Co's Earnings Before Depreciation and Amortization for the trailing twelve months (TTM) ended in Dec. 2016 was 323.6 (Mar. 2016 ) + 329.4 (Jun. 2016 ) + 347.8 (Sep. 2016 ) + -243.4 (Dec. 2016 ) = $757 Mil.

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

The Western Union Co's EV/Revenue for today is:

EV/Revenue ratio=Enterprise Value (Today)/Revenue (TTM)
=10357.390/5422.9
=1.91

The Western Union Co's current Enterprise Value is $10,357 Mil.
The Western Union Co's Earnings Before Depreciation and Amortization for the trailing twelve months (TTM) ended in Dec. 2016 was 1297.7 (Mar. 2016 ) + 1375.7 (Jun. 2016 ) + 1377.8 (Sep. 2016 ) + 1371.7 (Dec. 2016 ) = $5,423 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.

The Western Union Co Annual Data

Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15Dec16
ev 19,34912,10914,30410,64212,19110,0399,3189,8059,73511,135

The Western Union Co Quarterly Data

Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16Dec16
ev 6,9809,80510,90811,0769,1049,73510,42610,1289,77411,135
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