I'm new to the world of Value Investing (and investing in general) and am trying to fully understand the fundamentals in calculating the Owner's Earnings of a company.
According to this blog, Owner's Earnings can be calculated as follows:
Owner Earnings =
(a) Net Income
+ (b) depreciation, amortization
+/- (b) other non cash charges
- (c) annual maintenance capex (or the full capex)
+/- changes in working capital
However, I can see in LVS' 2005 Annual Report (pg. 80) that the deprecation and amortization is already deducted in the calculation of the Net Income for the year. Is this typical in the reporting of Net Income? If so, then why are we deducting it twice in the calculation for Owner's Earnings?