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GuruFocus has detected 6 Warning Signs with Yum Brands Inc $YUM.
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Yum Brands Inc (NYSE:YUM)
Enterprise Value
$30,857 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, Yum Brands Inc's enterprise value is $30,857 Mil. Yum Brands Inc's earnings before interest and taxes (EBIT) for the trailing twelve months (TTM) ended in Dec. 2016 was $1,625 Mil. Therefore, Yum Brands Inc's EV/EBIT ratio for today is 18.99.

EV/EBITDA ratio is calculated as enterprise value divided by its EBITDA. As of today, Yum Brands Inc's enterprise value is $30,857 Mil. Yum Brands Inc's earnings before depreciation and amortization for the trailing twelve months (TTM) ended in Dec. 2016 was $2,114 Mil. Therefore, Yum Brands Inc's EV/EBITDA ratio for today is 14.60.

EV/Revenue ratio is calculated as enterprise value divided by its Revenue. As of today, Yum Brands Inc's enterprise value is $30,857 Mil. Yum Brands Inc's revenue for the trailing twelve months (TTM) ended in Dec. 2016 was $6,366 Mil. Therefore, Yum Brands Inc's EV/Revenue ratio for today is 4.85.


Definition

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

Yum Brands 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
=22482.15+0+9061
+Current Portion of Long-Term Debt+Minority Interest-Cash and Cash Equivalents
+66+0-704
=30,905

Yum Brands 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
=22482.15+0+9061
+Current Portion of Long-Term Debt+Minority Interest-Cash and Cash Equivalents
+66+0-704
=30,905

* 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.

Yum Brands Inc's EV/EBIT for today is

Yum Brands Inc's current Enterprise Value is $30,857 Mil.
Yum Brands Inc's Earnings Before Interest and Taxes (EBIT) for the trailing twelve months (TTM) ended in Dec. 2016 was 564 (Mar. 2016 ) + 491 (Jun. 2016 ) + 654 (Sep. 2016 ) + -84 (Dec. 2016 ) = $1,625 Mil.

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

Yum Brands Inc's EV/EBITDA for today is:

Yum Brands Inc's current Enterprise Value is $30,857 Mil.
Yum Brands Inc's Earnings Before Depreciation and Amortization for the trailing twelve months (TTM) ended in Dec. 2016 was 700 (Mar. 2016 ) + 669 (Jun. 2016 ) + 829 (Sep. 2016 ) + -84 (Dec. 2016 ) = $2,114 Mil.

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

Yum Brands Inc's EV/Revenue for today is:

EV/Revenue ratio=Enterprise Value (Today)/Revenue (TTM)
=30856.720/6366
=4.85

Yum Brands Inc's current Enterprise Value is $30,857 Mil.
Yum Brands Inc's Earnings Before Depreciation and Amortization for the trailing twelve months (TTM) ended in Dec. 2016 was 2619 (Mar. 2016 ) + 3008 (Jun. 2016 ) + 3316 (Sep. 2016 ) + -2577 (Dec. 2016 ) = $6,366 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.

Yum Brands Inc Annual Data

Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15Dec16
ev 16,12613,84514,77418,76421,69323,75526,51625,51325,69430,905

Yum Brands Inc Quarterly Data

Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16Dec16
ev 25,01425,51327,25030,74827,14725,69427,85828,37030,85230,905
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