LTM (Last Twelve Months)

The last twelve months (LTM) - time period in financial analysis

What is LTM (Last Twelve Months)?

LTM (Last Twelve Months), also known as the trailing or rolling twelve months, is a measurement of time that illustrates a company’s business performance preceding the immediate 12-month time frame. This is not necessarily related to a fiscal year period, as the LTM references any period that ends on last day of the month dated on the financial statement.

Here is an example of how to calculate last 12 months Earnings per Share (EPS) halfway through a company’s fiscal year.

LTM example


How to Generate the Last Twelve Month Figures from Financial Reports?

In order to determine LTM figures, one would use the annual and last quarterly reports of a company. Items on the income statement for that reporting period can be added together, subtracting the items whose figures match the previous year.

LTM revenue = Most recent quarter figures + most recent annual figures – figures in the corresponding quarter 12 months before the most recent quarter. Alternatively, if one has access to full monthly data, then one can simply utilize the collection of the last twelve months data.

To illustrate:
A company reported a quarterly revenue of $5M on 3/31/2015, $15M yearly revenue on 12/31/2015, and $8M quarterly revenue on 3/31/2016. To generate the last twelve months figures ending 3/31/2016 the amount of revenue generated is $18M ($8M+$15M-$5M).


Why do Analysts and Policymakers use LTM?

  • LTM is considered useful in assessing the most recent business performance indicative of the company’s current trend
  • Its figures are more current than the fiscal or annual financial statements which helps avoid potentially misleading short-term measurements
  • It Compares relative performance of similar companies within an industry or sector
  • LTM figures provide a more accurate value of a business in the event of acquisition
  • It gives a relevant measurement of price to earnings ratio

LTM figures for US-based companies can be easily calculated by using a company’s 10-K and 10-Q SEC filings.


Learn More

Learn more about the use of the rolling twelve-month time frame in these contexts:

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