# Looking at Alphabet’s Valuation Multiples

By Neha GuptaUpdated

## What’s Alphabet’s economic value?

Alphabet boasts a total EV (enterprise value) of $608.2 billion. In comparison, Internet sector peers Facebook (FB), Amazon (AMZN), Alibaba (BABA), and Baidu (BIDU) have EVs of $411.8 billion, $686.9 billion, $443.8 billion, and $72.9 billion, respectively.

Alphabet has a TTM (trailing-12-month) EV-to-adjusted EBITDA (adjusted earnings before interest, tax, depreciation, and amortization) ratio of 17.0x. Its EV-to-EBITDA ratio for 2018 is projected to be 11.8x. Alphabet’s EBITDA margin for 2017 was 32%.

Its TTM EV-to-sales ratio is 5.5x, and its EV-to-projected sales ratio for next year is 3.9x. The company’s TTM EV-to-cash flow ratio was 16.4x, and its TTM EV-to-free cash flow ratio was 25.4x.

## Understanding Alphabet’s earnings and sales

Alphabet’s 2017 EPS (earnings per share) of $32.45 stemmed from total revenue of $110.9 billion. Revenue was up 23%. In 2018, revenue is expected to be $156.6 billion, and EPS of $41.40 are expected.

## Relative strength index

Alphabet has a 14-day RSI (relative strength index) score if 28, whereas Facebook’s, Amazon’s, Alibaba’s, and Baidu’s RSI scores are 22, 32, 36, and 23, respectively.

## How much debt is Alphabet carrying?

Alphabet’s balance sheet reflects total debt of $3.9 billion and total capital of ~$156.5 billion, which works out to a total debt-to-total capital ratio of 2.5%.The company’s debt-to-assets, debt-to-equity, and debt-to-EBITDA ratios work out to 0.02, 2.6, and 0.11, respectively. Alphabet has an interest coverage ratio of 1,090.9x.