SRSCQ (Sears Canada) Debt-to-EBITDA : -0.26 (As of Apr. 2017)

Author: Vera Yuan Vera Yuan
Vera Yuan
Vera Yuan
Director of Data and Quant Analytics at GuruFocus
Focused on building reliable datasets, financial models, and research tools for value-minded investors. Committed to turning complex data into practical guidance for value-investing and long-term wealth.
Reviewed by: Charlie Tian Charlie Tian
Charlie Tian
Charlie Tian
Founder & CEO of GuruFocus
Dr. Charlie Tian is the founder and CEO of GuruFocus.com, a leading global investment research platform established in 2004. With a Ph.D. in physics, Dr. Tian transitioned from science to finance, applying a data-driven, disciplined approach to value investing.

What is Sears Canada Debt-to-EBITDA?

Sears Canada SRSCQ -99.00% Debt-to-EBITDA is -0.26 as of Apr. 2017.

Debt-to-EBITDA measures a company's ability to pay off its debt.

Sears Canada's Short-Term Debt & Capital Lease Obligation for the quarter that ended in Apr. 2017 was $3 Mil. Sears Canada's Long-Term Debt & Capital Lease Obligation for the quarter that ended in Apr. 2017 was $102 Mil. Sears Canada's annualized EBITDA for the quarter that ended in Apr. 2017 was $-411 Mil. Sears Canada's annualized Debt-to-EBITDA for the quarter that ended in Apr. 2017 was -0.26.

A high Debt-to-EBITDA ratio generally means that a company may spend more time to paying off its debt. According to Joel Tillinghast's BIG MONEY THINKS SMALL: Biases, Blind Spots, and Smarter Investing, a ratio of Debt-to-EBITDA exceeding four is usually considered scary unless tangible assets cover the debt.

The historical rank and industry rank for Sears Canada's Debt-to-EBITDA or its related term are showing as below:

SRSCQ's Debt-to-EBITDA is not ranked *
in the Retail - Cyclical industry.
Industry Median: 2.4
* Ranked among companies with meaningful Debt-to-EBITDA only.

Sears Canada  (OTCPK:SRSCQ) Debt-to-EBITDA Explanation

In the calculation of Debt-to-EBITDA, we use the total of Short-Term Debt & Capital Lease Obligation and Long-Term Debt & Capital Lease Obligation divided by EBITDA. In some calculations, Total Liabilities is used to for calculation.


Be Aware

A high Debt-to-EBITDA ratio generally means that a company may spend more time to paying off its debt.

According to Joel Tillinghast's BIG MONEY THINKS SMALL: Biases, Blind Spots, and Smarter Investing, a ratio of Debt-to-EBITDA exceeding four is usually considered scary unless tangible assets cover the debt.


Sears Canada Debt-to-EBITDA Related Terms


Sears Canada Debt-to-EBITDA Historical Data

* Premium members only.

The historical data trend for Sears Canada's Debt-to-EBITDA can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

Sears Canada Debt-to-EBITDA Chart

Sears Canada Annual Data
Trend Jan08 Jan09 Jan10 Jan11 Jan12 Jan13 Jan14 Jan15 Jan16 Jan17
Debt-to-EBITDA
Get a 7-Day Free Trial Premium Member Only Premium Member Only 0.23 0.06 -0.10 -5.26 -0.07

Sears Canada Quarterly Data
Jul12 Oct12 Jan13 Apr13 Jul13 Oct13 Jan14 Apr14 Jul14 Oct14 Jan15 Apr15 Jul15 Oct15 Jan16 Apr16 Jul16 Oct16 Jan17 Apr17
Debt-to-EBITDA Get a 7-Day Free Trial Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only -0.12 -0.07 -0.05 -0.13 -0.26

Sears Canada Debt-to-EBITDA Competitor Comparison

For the Department Stores subindustry, Sears Canada's Debt-to-EBITDA, along with its competitors' market caps and Debt-to-EBITDA data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.


Sears Canada Debt-to-EBITDA vs Retail - Cyclical Industry

For the Retail - Cyclical industry and Consumer Cyclical sector, Sears Canada's Debt-to-EBITDA distribution charts can be found below:

* The bar in red indicates where Sears Canada's Debt-to-EBITDA falls into.



Sears Canada Debt-to-EBITDA Calculation

Debt-to-EBITDA measures a company's ability to pay off its debt.

Sears Canada's Debt-to-EBITDA for the fiscal year that ended in Jan. 2017 is calculated as

Debt-to-EBITDA=Total Debt / EBITDA
=(Short-Term Debt & Capital Lease Obligation + Long-Term Debt & Capital Lease Obligation) / EBITDA
=(2.807 + 12.592) / -210.802
=-0.07

Sears Canada's annualized Debt-to-EBITDA for the quarter that ended in Apr. 2017 is calculated as

Debt-to-EBITDA=Total Debt / EBITDA
=(Short-Term Debt & Capital Lease Obligation + Long-Term Debt & Capital Lease Obligation) / EBITDA
=(2.977 + 102.404) / -411.104
=-0.26

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

In the calculation of annual Debt-to-EBITDA, the EBITDA of the last fiscal year is used. In calculating the annualized quarterly data, the EBITDA data used here is four times the quarterly (Apr. 2017) EBITDA data.

Frequently Asked Questions Learn more about Debt-to-EBITDA →
What does a Debt-to-EBITDA of -0.26 mean?
Sears Canada (SRSCQ) has a Debt-to-EBITDA of -0.26 as of Apr. 2017. Debt-to-EBITDA ratio represents the ratio of total debt to total earnings before interest, taxes, depreciation and amortization. View historical data on Sears Canada.
Is Sears Canada's Debt-to-EBITDA too high?
Sears Canada's current Debt-to-EBITDA is -0.26.
How does Sears Canada's Debt-to-EBITDA compare to competitors?
Sears Canada's Debt-to-EBITDA of -0.26 can be compared against companies in the Retail - Cyclical industry. The industry median Debt-to-EBITDA is 2.40. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Debt-to-EBITDA for a Retail - Cyclical company?
The median Debt-to-EBITDA among Retail - Cyclical companies is 2.40, based on 902 companies in the industry. Companies in the top quartile (top 25%) have a Debt-to-EBITDA significantly above this median, while those in the bottom quartile fall well below. However, Debt-to-EBITDA should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Debt-to-EBITDA mean?
A high Debt-to-EBITDA can signal that a stock is expensive relative to its fundamentals. Debt-to-EBITDA ratio represents the ratio of total debt to total earnings before interest, taxes, depreciation and amortization. View historical data on Sears Canada. For the Retail - Cyclical industry, the median Debt-to-EBITDA is 2.40 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Sears Canada's current Debt-to-EBITDA is -0.26. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Sears Canada stock overvalued right now?
Sears Canada (SRSCQ) has a current Debt-to-EBITDA of -0.26. The current Debt-to-EBITDA is -0.26. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Debt-to-EBITDA calculated?
Debt-to-EBITDA is calculated from a company's financial statements. For Sears Canada (SRSCQ), the current Debt-to-EBITDA is -0.26 as of Apr. 2017. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.

Sears Canada Business Description

Address 290 Yonge Street, Suite 700, Toronto, ON, CAN, M5B 2C3
Sears Canada Inc is in the sale of goods and services through the Company's Retail channels. It comprised of one reportable segment, Merchandising. Which includes its full-line department, Sears Home, Hometown, Outlet, Corbeil Electrique Inc. stores, and its Direct (catalog/internet) channel. It also includes service revenue related primarily to logistics services provided through the Company. Commission revenue includes travel, home improvement services, insurance, wireless and long-distance plans. Licensee fee revenue is comprised of payments received from licensees that operate within the Company stores.