What is Reynolds American Earnings Yield (Joel Greenblatt) %?
Reynolds American's Enterprise Value for the quarter that ended in Mar. 2017 was $99,917 Mil.
Reynolds American's EBIT for the trailing twelve months (TTM) ended in Mar. 2017 was $5,748 Mil. Reynolds American's Earnings Yield (Joel Greenblatt) for the quarter that ended in Mar. 2017 was 5.75%.
The historical rank and industry rank for Reynolds American's Earnings Yield (Joel Greenblatt) % or its related term are showing as below:
RAI's Earnings Yield (Joel Greenblatt) % is not ranked *
in the Tobacco Products industry.
Industry Median: 5.5 * Ranked among companies with meaningful Earnings Yield (Joel Greenblatt) % only.
Joel Greenblatt's definition of earnings yield has the same problems the regular earnings yield does. It does not consider the growth of the company. It only looks at one-year's business operation. For cyclical companies, the earnings yield is usually highest at the peak of the business cycle. But these earnings are rarely sustainable.
A better indicator of the attractiveness of an investment which takes growth into account is the Forward Rate of Return (Yacktman) %. Reynolds American's Forward Rate of Return (Yacktman) % for the quarter that ended in Mar. 2017 was 32.33%. The Forward Rate of Return uses the normalized Free Cash Flow of the past seven years, and considers growth. The forward rate of return can be thought of as the return that investors buying the stock today can expect from it in the future.
Reynolds American Earnings Yield (Joel Greenblatt) % Historical Data
The historical data trend for Reynolds American's Earnings Yield (Joel Greenblatt) % can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
* Premium members only.
Reynolds American Earnings Yield (Joel Greenblatt) % Chart
Competitive Comparison of Reynolds American's Earnings Yield (Joel Greenblatt) %
For the Tobacco subindustry, Reynolds American's Earnings Yield (Joel Greenblatt) %, along with its competitors' market caps and Earnings Yield (Joel Greenblatt) % data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Reynolds American's Earnings Yield (Joel Greenblatt) % Distribution in the Tobacco Products Industry
For the Tobacco Products industry and Consumer Defensive sector, Reynolds American's Earnings Yield (Joel Greenblatt) % distribution charts can be found below:
* The bar in red indicates where Reynolds American's Earnings Yield (Joel Greenblatt) % falls into.
Reynolds American Earnings Yield (Joel Greenblatt) % Calculation
In his book, The Little That Beat the Market, hedge fund manager Joel Greenblatt defines Earnings Yield as operating income divided by enterprise value.
Reynolds Americans Earnings Yield (Joel Greenblatt) for the fiscal year that ended in Dec. 2016 is calculated as
Reynolds American's EBIT for the trailing twelve months (TTM) ended in Mar. 2017 adds up the quarterly data reported by the company within the most recent 12 months, which was $5,748 Mil.
Reynolds American (NYSE:RAI) Earnings Yield (Joel Greenblatt) % Explanation
Joel Greenblatt defines the earnings yield using the above equation because it more accurately reflects the company's profitability relative to its stock price. Items like interest payment and tax etc. are not directly related to the company's operational profitability.
Enterprise Value instead of market cap (share price) is used in the calculation because it is the real price stock and bond investors together pay for the company.
Be Aware
Joel Greenblatt's definition of earnings yield has the same problems the regular earnings yield does. It does not consider the growth of the company. It only looks at one-year's business operation. For cyclical companies, the earnings yield is usually highest at the peak of the business cycle. But these earnings are rarely sustainable.
Reynolds American Earnings Yield (Joel Greenblatt) % Related Terms
Thank you for viewing the detailed overview of Reynolds American's Earnings Yield (Joel Greenblatt) % provided by GuruFocus.com. Please click on the following links to see related term pages.
Reynolds American (Reynolds American) Business Description
Reynolds American controls roughly one third of the U.S. cigarette market and is the second-largest domestic cigarette manufacturer behind Altria. Its brands include Camel, Pall Mall, and Newport. Reynolds also owns the Grizzly and Kodiak smokeless tobacco brands. Another subsidiary, Santa Fe Natural Tobacco, manufactures superpremium Natural American Spirit cigarettes. In 2013, Reynolds entered the electronic cigarette market with its Vuse brand, which captured a significant share of this small but growing market.
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