TTM for Balance Sheet Items

Research
1

How are balance sheet items calculated for TTM versus QTR? Typically, profitability ratios will divide income by an average. For example:

EBITDA(0,TTM) / Avg(AstTot(0,QTR), AstTot(4,QTR))

I’m curious if the following calculation would arrive at the same answer, or something that is close enough conceptually:

EBITDA(0,TTM) / AstTot(0,TTM)

2

There’s a line in the documentation in the “Source & Availability” section that addresses this. There’s a lot of info there, so it’s a bit hard to find.

"For balance sheet items, TTM is the average of the trailing four quarters. "

Regards

3

Thanks Marco.

4

Marco,
Trailing Twelve Months (TTM) must be the sum of the trailing four quarters. The average of the trailing four quarters represents only one quarter and not 12 months.

5

Balance sheet is not cumulative. Summing balance sheet items is quadruple-dipping :slight_smile:

6

If earnings is summed, but balance sheet is averaged, then when you divide earnings TTM by total assets TTM to compute ROA TTM, there is a factor of 4 missing.

7

Total assets is like # shares. It is what it is, at the time of reporting; down’t matter if it’s reported in a Quarterly or Annual statement. No further processing needed unless you want an average.

TTM is a made up line item that either a) sums 4 interim numbers or b) averages 4 numbers

Not sure where the confusion is.