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GuruFocus has detected 7 Warning Signs with Aetna Inc $AET.
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Aetna Inc (NYSE:AET)
EV-to-EBIT
9.81 (As of Today)

EV/EBIT ratio is calculated as enterprise value divided by its Earnings Before Interest and Taxes (EBIT). As of today, Aetna Inc's enterprise value is $45,063 Mil. Aetna Inc's earnings before interest and taxes (EBIT) for the trailing twelve months (TTM) ended in Dec. 2016 was $4,595 Mil. Therefore, Aetna Inc's EV/EBIT ratio for today is 9.81.

AET' s EV-to-EBIT Range Over the Past 10 Years
Min: 2.7   Max: 11.4
Current: 9.79

2.7
11.4

During the past 13 years, the highest EV/EBIT Ratio of Aetna Inc was 11.40. The lowest was 2.70. And the median was 6.65.

AET's EV-to-EBIT is ranked lower than
67% of the 18 Companies
in the Global Health Care Plans industry.

( Industry Median: 12.70 vs. AET: 9.79 )

Joel Greenblatt calls the inversion of this ratio Earnings Yield (Joel Greenblatt). Aetna Inc's enterprise value for the quarter that ended in Dec. 2016 was $43,196 Mil. Aetna Inc's earnings before interest and taxes (EBIT) for the trailing twelve months (TTM) ended in Dec. 2016 was $4,595 Mil. Aetna Inc's Earnings Yield (Joel Greenblatt) for the quarter that ended in Dec. 2016 was 10.64%.


Definition

Aetna Inc's EV/EBIT for today is calculated as:

EV/EBIT=Enterprise Value (Today)/Earnings Before Interest and Taxes (EBIT) (TTM)
=45062.633/4595
=9.81

Aetna Inc's current Enterprise Value is $45,063 Mil.
Aetna Inc's Earnings Before Interest and Taxes (EBIT) for the trailing twelve months (TTM) ended in Dec. 2016 was 1390.4 (Mar. 2016 ) + 1477.3 (Jun. 2016 ) + 1262.7 (Sep. 2016 ) + 464.6 (Dec. 2016 ) = $4,595 Mil.

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


Explanation

This is a more accurate valuation of companies' operation because it consider the debt and cash on its balance sheet, and non-operating items such as interest payment, tax, and one-time items are not included in the Operating Income.

Joel Greenblatt calls the inversion of this ratio Earnings Yield (Joel Greenblatt).

Aetna Inc's Earnings Yield (Joel Greenblatt) for the quarter that ended in Dec. 2016 is calculated as:

Earnings Yield (Joel Greenblatt) (Q: Dec. 2016 )=EBIT (TTM)/Enterprise Value (Q: Dec. 2016 )
=4595/43196.109
=10.64 %

Aetna Inc's Enterprise Value for the quarter that ended in Dec. 2016 was $43,196 Mil.
Aetna Inc's Earnings Before Interest and Taxes (EBIT) for the trailing twelve months (TTM) ended in Dec. 2016 was 1390.4 (Mar. 2016 ) + 1477.3 (Jun. 2016 ) + 1262.7 (Sep. 2016 ) + 464.6 (Dec. 2016 ) = $4,595 Mil.

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


Related Terms

Enterprise Value, Earnings Yield (Joel Greenblatt), Earnings Before Interest and Taxes (EBIT)


Historical Data

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

Aetna Inc Annual Data

Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15Dec16
ev2ebit 9.956.196.364.164.895.999.069.318.719.40

Aetna Inc Quarterly Data

Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16Dec16
ev2ebit 8.209.3110.1611.119.368.718.879.288.129.40
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