Enterprise Value to EBITDA (EV/EBITDA)
Earnings before Interest, Tax, Depreciation and Amortization (EBITDA)
EQT Corp., EBITDA calculation
US$ in thousands
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
Financial performance from 2017 to 2021 is characterized by significant volatility and a pronounced divergence between operational cash flow proxies and bottom-line profitability.
- EBITDA Trends
- EBITDA experienced a sharp decline from US$ 1,455,083 thousand in 2017 to a deficit of US$ 1,041,360 thousand in 2018. A recovery was observed starting in 2019, with figures returning to positive territory at US$ 177,041 thousand, increasing to US$ 424,637 thousand in 2020, and remaining relatively stable at US$ 396,917 thousand in 2021.
- Profitability and Net Income
- In contrast to the EBITDA recovery, net income remained negative for four consecutive years following 2017. After a peak net income of US$ 1,508,529 thousand in 2017, a substantial loss of US$ 2,244,568 thousand was recorded in 2018. Although losses narrowed slightly in subsequent years, the trend remained negative, concluding with a loss of US$ 1,155,759 thousand in 2021.
- Operating and Pre-tax Performance
- Earnings before interest and tax (EBIT) and earnings before tax (EBT) followed a trajectory closely aligned with net income. Both metrics shifted from positive values in 2017 to consistent deficits from 2018 through 2021. EBIT reached its lowest point in 2018 at US$ -2,848,473 thousand and ended the period at US$ -1,279,785 thousand in 2021.
- Impact of Non-Cash Charges
- A significant divergence is observed between EBITDA and EBIT from 2019 to 2021. While EBITDA returned to positive values, EBIT remained deeply negative throughout the same period. This indicates that depreciation and amortization expenses are substantial and outweigh the operational earnings, contributing heavily to the overall net losses despite the recovery in EBITDA.
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Enterprise Value to EBITDA Ratio, Current
EQT Corp., current EV/EBITDA calculation, comparison to benchmarks
| Selected Financial Data (US$ in thousands) | |
| Enterprise value (EV) | 19,738,773) |
| Earnings before interest, tax, depreciation and amortization (EBITDA) | 396,917) |
| Valuation Ratio | |
| EV/EBITDA | 49.73 |
| Benchmarks | |
| EV/EBITDA, Competitors1 | |
| Chevron Corp. | 10.92 |
| ConocoPhillips | 6.75 |
| Exxon Mobil Corp. | 10.53 |
| EV/EBITDA, Sector | |
| Oil, Gas & Consumable Fuels | 11.62 |
| EV/EBITDA, Industry | |
| Energy | 11.83 |
Based on: 10-K (reporting date: 2021-12-31).
1 Click competitor name to see calculations.
If the company EV/EBITDA is lower then the EV/EBITDA of benchmark then company is relatively undervalued.
Otherwise, if the company EV/EBITDA is higher then the EV/EBITDA of benchmark then company is relatively overvalued.
Enterprise Value to EBITDA Ratio, Historical
EQT Corp., historical EV/EBITDA calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Enterprise value (EV)1 | 13,535,699) | 10,260,386) | 6,662,726) | 10,130,562) | 25,173,003) | |
| Earnings before interest, tax, depreciation and amortization (EBITDA)2 | 396,917) | 424,637) | 177,041) | (1,041,360) | 1,455,083) | |
| Valuation Ratio | ||||||
| EV/EBITDA3 | 34.10 | 24.16 | 37.63 | — | 17.30 | |
| Benchmarks | ||||||
| EV/EBITDA, Competitors4 | ||||||
| Chevron Corp. | 7.18 | — | — | — | — | |
| ConocoPhillips | 6.34 | — | — | — | — | |
| Exxon Mobil Corp. | 7.07 | — | — | — | — | |
| EV/EBITDA, Sector | ||||||
| Oil, Gas & Consumable Fuels | 6.97 | — | — | — | — | |
| EV/EBITDA, Industry | ||||||
| Energy | 7.24 | — | — | — | — | |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
3 2021 Calculation
EV/EBITDA = EV ÷ EBITDA
= 13,535,699 ÷ 396,917 = 34.10
4 Click competitor name to see calculations.
The financial profile between 2017 and 2021 is characterized by significant volatility in both market valuation and operational earnings. A period of sharp contraction in enterprise value and earnings was followed by a recovery phase starting in 2020.
- Enterprise Value Trends
- Enterprise value experienced a substantial decline from 25.17 billion US dollars in 2017 to a low of 6.66 billion US dollars in 2019. This downward trajectory reversed in 2020, with the value increasing to 10.26 billion US dollars and further ascending to 13.54 billion US dollars by the end of 2021.
- EBITDA Performance
- Earnings before interest, tax, depreciation and amortization showed extreme instability. Following a positive result of 1.46 billion US dollars in 2017, earnings fell to a negative 1.04 billion US dollars in 2018. Although profitability returned in 2019 and reached 424.64 million US dollars in 2020, the 2021 figure of 396.92 million US dollars indicates a stabilization at a level significantly below the 2017 baseline.
- EV/EBITDA Ratio Dynamics
- The EV/EBITDA ratio exhibits high variance throughout the period. The ratio was not applicable in 2018 due to negative EBITDA. A peak of 37.63 in 2019 occurred as earnings returned to positive territory while enterprise value remained depressed. The subsequent shift to 24.16 in 2020 and the increase to 34.10 in 2021 suggests that the growth in enterprise value outpaced the growth in operating earnings during the recovery phase.
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