BAE Systems EBITDA vs. Current Valuation
| BA Stock | 1,156 10.00 0.86% |
EBITDA | First Reported 2010-12-31 | Previous Quarter 3.4 B | Current Value 3.6 B | Quarterly Volatility 865.8 M |
For BAE Systems profitability analysis, we use financial ratios and fundamental drivers that measure the ability of BAE Systems to generate income relative to revenue, assets, operating costs, and current equity. These fundamental indicators attest to how well BAE Systems plc utilizes its assets to generate profit and value for its shareholders. The profitability module also shows relationships between BAE Systems's most relevant fundamental drivers. It provides multiple suggestions of what could affect the performance of BAE Systems plc over time as well as its relative position and ranking within its peers.
BAE |
BAE Systems plc Current Valuation vs. EBITDA Fundamental Analysis
Comparative valuation techniques use various fundamental indicators to help in determining BAE Systems's current stock value. Our valuation model uses many indicators to compare BAE Systems value to that of its competitors to determine the firm's financial worth. BAE Systems plc is number one stock in ebitda category among its peers. It also is the top company in current valuation category among its peers reporting about 12.35 of Current Valuation per EBITDA. At present, BAE Systems' EBITDA is projected to increase significantly based on the last few years of reporting. The reason why the comparable model can be used in almost all circumstances is due to the vast number of multiples that can be utilized, such as the price-to-earnings (P/E), price-to-book (P/B), price-to-sales (P/S), price-to-cash flow (P/CF), and many others. The P/E ratio is the most commonly used of these ratios because it focuses on the BAE Systems' earnings, one of the primary drivers of an investment's value.BAE Current Valuation vs. EBITDA
EBITDA stands for earnings before interest, taxes, depreciation, and amortization. It is a measure of a company operating cash flow based on data from the company income statement and is a very good way to compare companies within industries or across different sectors. However, unlike Operating Cash Flow, EBITDA does not include the effects of changes in working capital.
BAE Systems |
| = | 3.45 B |
In a nutshell, EBITDA is calculated by adding back each of the excluded items to the post-tax profit, and can be used to compare companies with very different capital structures.
Enterprise Value is a firm valuation proxy that approximates the current market value of a company. It is typically used to determine the takeover or merger price of a firm. Unlike Market Cap, this measure takes into account the entire liquid asset, outstanding debt, and exotic equity instruments that the company has on its balance sheet. When a takeover occurs, the parent company will have to assume the target company's liabilities but will take possession of all cash and cash equivalents.
BAE Systems |
| = | 42.56 B |
Enterprise Value can be a useful tool to compare companies with different capital structures. Long term liability and current cash or cash equivalents can have a huge impact on market valuation of a given company.
BAE Current Valuation vs Competition
BAE Systems plc is the top company in current valuation category among its peers. After adjusting for long-term liabilities, total market size of Industrials industry is currently estimated at about 94.96 Trillion. BAE Systems adds roughly 42.56 Billion in current valuation claiming only tiny portion of equities under Industrials industry.
BAE Systems Profitability Projections
The most important aspect of a successful company is its ability to generate a profit. For investors in BAE Systems, profitability is also one of the essential criteria for including it into their portfolios because, without profit, BAE Systems will eventually generate negative long term returns. The profitability progress is the general direction of BAE Systems' change in net profit over the period of time. It can combine multiple indicators of BAE Systems, where stable trends show no significant progress. An accelerating trend is seen as positive, while a decreasing one is unfavorable. A rising trend means that profits are rising, and operational efficiency may be rising as well. A decreasing trend is a sign of poor performance and may indicate upcoming losses.
| Last Reported | Projected for Next Year | ||
| Accumulated Other Comprehensive Income | 6.2 B | 6.5 B | |
| Operating Income | 2.6 B | 2.7 B | |
| Income Before Tax | 2.1 B | 2.2 B | |
| Total Other Income Expense Net | -455 M | -477.8 M | |
| Net Income | 1.9 B | 1.9 B | |
| Income Tax Expense | 386 M | 405.3 M | |
| Net Income Applicable To Common Shares | 1.8 B | 1.2 B | |
| Net Income From Continuing Ops | 1.9 B | 1.3 B | |
| Net Interest Income | -190 M | -199.5 M | |
| Interest Income | 172 M | 180.6 M | |
| Change To Netincome | 144.9 M | 152.1 M |
BAE Profitability Driver Comparison
Profitability drivers are factors that can directly affect your investment outlook on BAE Systems. Investors often realize that things won't turn out the way they predict. There are maybe way too many unforeseen events and contingencies during the holding period of BAE Systems position where the market behavior may be hard to predict, tax policy changes, gold or oil price hikes, calamities change, and many others. The question is, are you prepared for these unexpected events? Although some of these situations are obviously beyond your control, you can still follow the important profit indicators to know where you should focus on when things like this occur. Below are some of the BAE Systems' important profitability drivers and their relationship over time.
Use BAE Systems in pair-trading
One of the main advantages of trading using pair correlations is that every trade hedges away some risk. Because there are two separate transactions required, even if BAE Systems position performs unexpectedly, the other equity can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in BAE Systems will appreciate offsetting losses from the drop in the long position's value.BAE Systems Pair Trading
BAE Systems plc Pair Trading Analysis
The ability to find closely correlated positions to BAE Systems could be a great tool in your tax-loss harvesting strategies, allowing investors a quick way to find a similar-enough asset to replace BAE Systems when you sell it. If you don't do this, your portfolio allocation will be skewed against your target asset allocation. So, investors can't just sell and buy back BAE Systems - that would be a violation of the tax code under the "wash sale" rule, and this is why you need to find a similar enough asset and use the proceeds from selling BAE Systems plc to buy it.
The correlation of BAE Systems is a statistical measure of how it moves in relation to other instruments. This measure is expressed in what is known as the correlation coefficient, which ranges between -1 and +1. A perfect positive correlation (i.e., a correlation coefficient of +1) implies that as BAE Systems moves, either up or down, the other security will move in the same direction. Alternatively, perfect negative correlation means that if BAE Systems plc moves in either direction, the perfectly negatively correlated security will move in the opposite direction. If the correlation is 0, the equities are not correlated; they are entirely random. A correlation greater than 0.8 is generally described as strong, whereas a correlation less than 0.5 is generally considered weak.
Correlation analysis and pair trading evaluation for BAE Systems can also be used as hedging techniques within a particular sector or industry or even over random equities to generate a better risk-adjusted return on your portfolios.Use Investing Themes to Complement your BAE Systems position
In addition to having BAE Systems in your portfolios, you can quickly add positions using our predefined set of ideas and optimize them against your very unique investing style. A single investing idea is a collection of funds, stocks, ETFs, or cryptocurrencies that are programmatically selected from a pull of investment themes. After you determine your investment opportunity, you can then find an optimal portfolio that will maximize potential returns on the chosen idea or minimize its exposure to market volatility.Did You Try This Idea?
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Other Information on Investing in BAE Stock
To fully project BAE Systems' future profitability, investors should examine all historical financial statements. These statements provide investors with a comprehensive snapshot of the financial position of BAE Systems plc at a specified time, usually calculated after every quarter, six months, or one year. Three primary documents fall into the category of financial statements. These documents include BAE Systems' income statement, its balance sheet, and the statement of cash flows.