Switch to:
GuruFocus has detected 4 Warning Signs with Assurant Inc $AIZ.
More than 500,000 people have already joined GuruFocus to track the stocks they follow and exchange investment ideas.
Assurant Inc (NYSE:AIZ)
EBITDA
$782 Mil (TTM As of Mar. 2017)

Assurant Inc's EBITDA for the three months ended in Mar. 2017 was $228 Mil. Its EBITDA for the trailing twelve months (TTM) ended in Mar. 2017 was $782 Mil.

During the past 12 months, the average EBITDA Growth Rate of Assurant Inc was 52.90% per year. During the past 3 years, the average EBITDA Growth Rate was 1.90% per year. During the past 5 years, the average EBITDA Growth Rate was -5.00% per year. During the past 10 years, the average EBITDA Growth Rate was -3.40% per year. Please click Growth Rate Calculation Example (GuruFocus) to see how GuruFocus calculates Wal-Mart Stores Inc (WMT)'s revenue growth rate. You can apply the same method to get the EBITDA Growth Rate using EBITDA data.

During the past 13 years, the highest 3-Year average EBITDA Growth Rate of Assurant Inc was 59.40% per year. The lowest was -24.80% per year. And the median was 5.00% per year.

Assurant Inc's EBITDA per Share for the three months ended in Mar. 2017 was $4.01. Its EBITDA per share for the trailing twelve months (TTM) ended in Mar. 2017 was $13.04.

During the past 12 months, the average EBITDA per Share Growth Rate of Assurant Inc was 70.10% per year. During the past 3 years, the average EBITDA per Share Growth Rate was 9.80% per year. During the past 5 years, the average EBITDA per Share Growth Rate was 3.50% per year. During the past 10 years, the average EBITDA per Share Growth Rate was 4.30% per year. Please click Growth Rate Calculation Example (GuruFocus) to see how GuruFocus calculates Wal-Mart Stores Inc (WMT)'s revenue growth rate. You can apply the same method to get the EBITDA per share growth rate using EBITDA per Share data.

During the past 13 years, the highest 3-Year average EBITDA per Share Growth Rate of Assurant Inc was 50.90% per year. The lowest was -19.30% per year. And the median was 13.40% per year.


Definition

Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) is what the company earns before it expenses interest, taxes, depreciation and amortization.

Assurant Inc's EBITDA for the fiscal year that ended in Dec. 2016 is calculated as

EBITDA(A: Dec. 2016 )
=Pretax Income+Interest Expense (positive number)+Depreciation, Depletion and Amortization
=848.588+57.619+125.143
=1,031

Assurant Inc's EBITDA for the quarter that ended in Mar. 2017 is calculated as

Assurant Inc EBITDA for the trailing twelve months (TTM) ended in Mar. 2017 was 250.744 (Jun. 2016 ) + 234.864 (Sep. 2016 ) + 68.589 (Dec. 2016 ) + 227.7 (Mar. 2017 ) = $782 Mil.

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

Sometimes companies may have already deducted Depreciation and Amortization from Gross Profit. In this case Depreciation and Amortization needs to be added back when calculating EBITDA.


Explanation

EBITDA is a cash flow measure that ignores changes in working capital. EBITDA minus Depreciation, and Amortization (DA) equals Operating Income. Operating Income is profit before interest and taxes. Of course, Interest and taxes need to be paid.

While depreciation and amortization expenses do not need to be paid in cash, assets - especially tangible assets - do need to be replaced over time. EBITDA is not a measure of profit in any sense. EBITDA is a measure of cash generation by a business where the uses of that cash may be more or less discretionary depending on the nature of the business.

The EBITDA of a TV station is largely discretionary. Owners may use much of the EBITDA generated by a TV station as they see fit. The EBITDA of a railroad is largely non-discretionary. Owners must use much of the EBITDA generated by a railroad to replace the physical assets of the railroad or the business will literally fall apart over time.

EBITDA can be thought of as the cash a business generates that is available to:

• Add more inventory
• Add more receivables
• Replace property, plant, and equipment
• Add more property, plant, and equipment
• Pay interest
• Pay taxes
• And finally: pay owners

EBITDA is widely used in financial analysis because Depreciation and Amortization are not present day cash expenses.. Depreciation and amortization are the spreading out of the costs of assets over the time in which those assets provide benefits. Today’s depreciation and amortization expenses relate to assets bought in the past. The assets being expensed may or may not need to be replaced in the future. And the cost to replace the assets may be more or less than it was in the past. For this reason, the depreciation and amortization expenses a company records in the present year may have no relationship to the actual cash costs needed to maintain its assets in future years.

A company’s depreciation expense depends on both its expectations about the assets it owns and its choice of accounting methods. Two companies owning identical assets may have different depreciation expenses because they have different expectations about the useful lives of those assets and because they make different accounting choices.

Analysts use EBITDA to remove this element of personal choice from a company’s accounting statements. The use of EBITDA is an attempt to make the results of different companies more comparable and uniform.


Be Aware

Although depreciation is not a cash cost it is a real business cost because the company has to pay for the fixed assets when they purchase them. Both Warren Buffett and Charlie Munger hate the idea of EDITDA because in this calculation, depreciation is not counted as an expense.

EBITDA over Revenue is a good metric for comparing the operating efficiencies between companies because EBITDA is less vulnerable to companies’ accounting choices. For this reason, EBITDA is used in ranking the Predictability of Companies. Also price/EBITDA is sometimes used in valuations.


Related Terms

Pretax Income, Interest Expense, Depreciation, Depletion and Amortization, Operating Income, EBITDA Per Share, Growth Rate Calculation Example (GuruFocus)


Historical Data

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

Assurant Inc Annual Data

Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15Dec16
Pretax Income 1,011563710606706758790744201849
Interest Expense (positive) 61616161606078585558
DDA 616291116109106109132137125
EBITDA 1,1336868627838759249769353931,031

Assurant Inc Quarterly Data

Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16Dec16Mar17
Pretax Income 908340-3211033823622155215
Interest Expense (positive) 14141414141515141413
DDA 0000000000
EBITDA 1049754-1812435225123569228
Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to $400 per referral. ( Learn More)

GF Chat

{{numOfNotice}}
FEEDBACK