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GuruFocus has detected 2 Warning Signs with Lowe's Companies Inc $LOW.
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Lowe's Companies Inc (NYSE:LOW)
EV-to-EBIT
14.26 (As of Today)

EV/EBIT ratio is calculated as enterprise value divided by its Earnings Before Interest and Taxes (EBIT). As of today, Lowe's Companies Inc's enterprise value is $83,499 Mil. Lowe's Companies Inc's earnings before interest and taxes (EBIT) for the trailing twelve months (TTM) ended in Jan. 2017 was $5,857 Mil. Therefore, Lowe's Companies Inc's EV/EBIT ratio for today is 14.26.

LOW' s EV-to-EBIT Range Over the Past 10 Years
Min: 6.5   Max: 16.9
Current: 14.26

6.5
16.9

During the past 13 years, the highest EV/EBIT Ratio of Lowe's Companies Inc was 16.90. The lowest was 6.50. And the median was 12.00.

LOW's EV-to-EBIT is ranked higher than
51% of the 1045 Companies
in the Global Home Improvement Stores industry.

( Industry Median: 14.87 vs. LOW: 14.26 )

Joel Greenblatt calls the inversion of this ratio Earnings Yield (Joel Greenblatt). Lowe's Companies Inc's enterprise value for the quarter that ended in Jan. 2017 was $81,544 Mil. Lowe's Companies Inc's earnings before interest and taxes (EBIT) for the trailing twelve months (TTM) ended in Jan. 2017 was $5,857 Mil. Lowe's Companies Inc's Earnings Yield (Joel Greenblatt) for the quarter that ended in Jan. 2017 was 7.18%.


Definition

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

EV/EBIT=Enterprise Value (Today)/Earnings Before Interest and Taxes (EBIT) (TTM)
=83499.028/5857
=14.26

Lowe's Companies Inc's current Enterprise Value is $83,499 Mil.
Lowe's Companies Inc's Earnings Before Interest and Taxes (EBIT) for the trailing twelve months (TTM) ended in Jan. 2017 was 1588 (Apr. 2016 ) + 2055 (Jul. 2016 ) + 943 (Oct. 2016 ) + 1271 (Jan. 2017 ) = $5,857 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).

Lowe's Companies Inc's Earnings Yield (Joel Greenblatt) for the quarter that ended in Jan. 2017 is calculated as:

Earnings Yield (Joel Greenblatt) (Q: Jan. 2017 )=EBIT (TTM)/Enterprise Value (Q: Jan. 2017 )
=5857/81543.8
=7.18 %

Lowe's Companies Inc's Enterprise Value for the quarter that ended in Jan. 2017 was $81,544 Mil.
Lowe's Companies Inc's Earnings Before Interest and Taxes (EBIT) for the trailing twelve months (TTM) ended in Jan. 2017 was 1588 (Apr. 2016 ) + 2055 (Jul. 2016 ) + 943 (Oct. 2016 ) + 1271 (Jan. 2017 ) = $5,857 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.

Lowe's Companies Inc Annual Data

Jan08Jan09Jan10Jan11Jan12Jan13Jan14Jan15Jan16Jan17
ev2ebit 9.418.4511.4110.9112.0314.1413.9015.0215.5113.92

Lowe's Companies Inc Quarterly Data

Oct14Jan15Apr15Jul15Oct15Jan16Apr16Jul16Oct16Jan17
ev2ebit 14.6115.0214.4613.9113.7615.5114.7515.9414.4113.92
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