Enterprise Value to EBITDA (EV/EBITDA)
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- Balance Sheet: Assets
- Common-Size Income Statement
- Common-Size Balance Sheet: Liabilities and Stockholders’ Equity
- Analysis of Short-term (Operating) Activity Ratios
- Capital Asset Pricing Model (CAPM)
- Selected Financial Data since 2005
- Return on Equity (ROE) since 2005
- Debt to Equity since 2005
- Total Asset Turnover since 2005
- Price to Book Value (P/BV) since 2005
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Earnings before Interest, Tax, Depreciation and Amortization (EBITDA)
Freeport-McMoRan Inc., EBITDA calculation
US$ in millions
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
The financial results over the five-year period show notable fluctuations in profitability metrics, reflecting changing operational and market conditions.
- Net income attributable to common stockholders
- This measure experienced a sharp increase from 599 million US dollars in 2020 to a peak of 4,306 million US dollars in 2021, indicating substantial profit growth in that year. However, it subsequently declined over the following two years to 1,848 million in 2023 before showing a marginal recovery to 1,889 million in 2024. Despite this recovery, the net income in 2023 and 2024 remains substantially below the peak achieved in 2021, suggesting profitability challenges or increased costs during these years.
- Earnings before tax (EBT)
- The EBT trend mirrors that of net income but at a higher absolute level, starting at 1,809 million US dollars in 2020 and rising sharply to 7,664 million in 2021. There is a decline in 2022 and 2023 to 6,746 million and 6,021 million respectively, followed by a moderate rise to 6,922 million in 2024. This pattern suggests that tax and other income statement items have modestly influenced net income volatility but underlying earnings before tax have similarly been affected by market or operational factors.
- Earnings before interest and tax (EBIT)
- EBIT also shows a strong surge in 2021, reaching 8,266 million US dollars from 2,407 million in 2020, followed by declines in the two subsequent years to 7,306 million in 2022 and 6,536 million in 2023. A rebound to 7,241 million in 2024 indicates some stabilization. This trend suggests that operating income was significantly boosted in 2021, potentially due to higher revenue or improved margins, but faced downward pressure in later years possibly from increased operating costs or reduced sales.
- Earnings before interest, tax, depreciation and amortization (EBITDA)
- EBITDA, representing the broader operational cash flow measure, rose from 3,935 million US dollars in 2020 to 10,264 million in 2021, the highest figure in the period. It subsequently declined each year to 9,325 million in 2022 and 8,604 million in 2023 before increasing again to 9,482 million in 2024. This pattern is consistent with the trends seen in EBIT and EBT, pointing to a cyclical or volatile operating environment. The magnitude of EBITDA changes exceeds those of EBIT and net income, emphasizing the influence of non-operating expenses and taxes on the bottom line.
Overall, the data indicate a peak in profitability and earnings in 2021 across all key earnings metrics, followed by a multi-year decline and partial recovery by 2024. The substantial rise in 2021 suggests an exceptional year likely driven by favorable market or operational conditions. The subsequent reduction in profitability points toward increased challenges or normalization of earnings levels. The partial rebounds in 2024 suggest some improvement but do not restore earnings to the peak levels seen in 2021. This analysis highlights the company's earnings volatility and the importance of monitoring operating efficiency and external factors impacting profitability.
Enterprise Value to EBITDA Ratio, Current
Freeport-McMoRan Inc., current EV/EBITDA calculation, comparison to benchmarks
| Selected Financial Data (US$ in millions) | |
| Enterprise value (EV) | |
| Earnings before interest, tax, depreciation and amortization (EBITDA) | |
| Valuation Ratio | |
| EV/EBITDA | |
| Benchmarks | |
| EV/EBITDA, Industry | |
| Materials | |
Based on: 10-K (reporting date: 2024-12-31).
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
Freeport-McMoRan Inc., historical EV/EBITDA calculation, comparison to benchmarks
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
- Enterprise Value (EV)
- The enterprise value exhibits an overall upward trend from 2020 to 2024, increasing from $62,532 million in 2020 to $72,055 million in 2024. Notably, there was a significant rise in 2021 to $73,951 million, followed by a decline to $69,771 million in 2023, before edging slightly higher again in 2024.
- Earnings Before Interest, Tax, Depreciation and Amortization (EBITDA)
- EBITDA shows considerable growth over the period. It surged from $3,935 million in 2020 to a peak of $10,264 million in 2021, indicating strong operational performance gains. Although it declined to $8,604 million in 2023, it rebounded to $9,482 million in 2024, maintaining a significantly higher level than the 2020 baseline.
- EV/EBITDA Ratio
- The EV/EBITDA ratio reveals a decreasing trend from 15.89 in 2020 to a more moderate range between 7.2 and 8.11 from 2021 through 2024. This suggests that the market valuation relative to earnings improved substantially after 2020, reflecting either a valuation correction or enhanced earnings performance. Post-2021, the ratio stabilized around 7.6 to 8.11, indicating a consistent market valuation relative to EBITDA.
- Summary of Insights
- The data indicates strong EBITDA growth driven by improved operational efficiency or market conditions in 2021, with some volatility in subsequent years. Enterprise value increased overall but showed some fluctuations, possibly reflecting market dynamics or investor sentiment changes. The decline and stabilization of the EV/EBITDA ratio suggest the company's valuation became more aligned with its earnings capacity after 2020, improving investment attractiveness or reflecting market reassessment of earnings quality. The partial rebound of EBITDA and enterprise value in 2024 indicates a potential recovery or sustained operational strength.