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GuruFocus has detected 3 Warning Signs with Alphabet Inc $GOOG.
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Alphabet Inc (NAS:GOOG)
EV-to-EBIT
20.55 (As of Today)

EV/EBIT ratio is calculated as enterprise value divided by its Earnings Before Interest and Taxes (EBIT). As of today, Alphabet Inc's enterprise value is $498,831 Mil. Alphabet Inc's earnings before interest and taxes (EBIT) for the trailing twelve months (TTM) ended in Dec. 2016 was $24,274 Mil. Therefore, Alphabet Inc's EV/EBIT ratio for today is 20.55.

GOOG' s EV-to-EBIT Range Over the Past 10 Years
Min: 10.6   Max: 47.1
Current: 20.55

10.6
47.1

During the past 13 years, the highest EV/EBIT Ratio of Alphabet Inc was 47.10. The lowest was 10.60. And the median was 18.50.

GOOG's EV-to-EBIT is ranked lower than
53% of the 285 Companies
in the Global Internet Content & Information industry.

( Industry Median: 19.45 vs. GOOG: 20.55 )

Joel Greenblatt calls the inversion of this ratio Earnings Yield (Joel Greenblatt). Alphabet Inc's enterprise value for the quarter that ended in Dec. 2016 was $451,153 Mil. Alphabet Inc's earnings before interest and taxes (EBIT) for the trailing twelve months (TTM) ended in Dec. 2016 was $24,274 Mil. Alphabet Inc's Earnings Yield (Joel Greenblatt) for the quarter that ended in Dec. 2016 was 5.38%.


Definition

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

EV/EBIT=Enterprise Value (Today)/Earnings Before Interest and Taxes (EBIT) (TTM)
=498830.670/24274
=20.55

Alphabet Inc's current Enterprise Value is $498,831 Mil.
Alphabet Inc's Earnings Before Interest and Taxes (EBIT) for the trailing twelve months (TTM) ended in Dec. 2016 was 5159 (Mar. 2016 ) + 6151 (Jun. 2016 ) + 6074 (Sep. 2016 ) + 6890 (Dec. 2016 ) = $24,274 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).

Alphabet 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 )
=24274/451153.4478
=5.38 %

Alphabet Inc's Enterprise Value for the quarter that ended in Dec. 2016 was $451,153 Mil.
Alphabet Inc's Earnings Before Interest and Taxes (EBIT) for the trailing twelve months (TTM) ended in Dec. 2016 was 5159 (Mar. 2016 ) + 6151 (Jun. 2016 ) + 6074 (Sep. 2016 ) + 6890 (Dec. 2016 ) = $24,274 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.

Alphabet Inc Annual Data

Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15Dec16
ev2ebit 38.7512.2120.5814.8713.6813.1120.2117.4123.6419.17

Alphabet Inc Quarterly Data

Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16Dec16
ev2ebit 19.7317.4118.2216.9419.4723.6422.3819.0621.0119.17
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