Ev/Ebitda

What is EV khổng lồ EBITDA?

EV (which is the sum of market capitalization, preferred shares, minority shares, debt minus cash) to EBITDA is the ratio between enterprise value và Earnings Before Interest, Taxes, Depreciation, & Amortization that helps the investor in the valuation of the company at a very subtle cấp độ by allowing the investor khổng lồ compare a certain company khổng lồ the parallel company in the industry as a whole, or other comparative sầu industries.

Bạn đang xem: Ev/ebitda

EV khổng lồ EBITDA Multiple is a vital valuation metric used for measuring the value of the company with an objective of comparing its valuation with similar stocks in the sector and it is calculated by dividing the enterprise value (Current Market Cap + Debt + Minority Interest + preferred shares – cash) by EBITDA (earnings before interest, taxes, depreciation, & amortization) of the company.

I rate this multiple above sầu PE Ratio! The values of EV and EBITDA are used to find the EV/EBITDA ratio of an organization, và this metric is widely used khổng lồ analyze and measure an organization’s ROI, i.e., return of investment as well as its value.

Xem thêm: Tải Game Bóng Đá Offline Miễn Phí Hay Nhất Cho Pc Kèm Link, # Top 50 Game Bóng Đá Offline Pc Hay Nhất

*
*
*
*
*
*
*
*
*
*
*
*
*

source: Square SEC Filings

Conclusion

EV/EBITDA ratio is an essential và widely used metric to lớn analyze a company’s Total Value. This metric has been successful in solving the problems encountered while using the traditional metrics, lượt thích the PE ratio, and hence it is preferred over them.

Also, as this ratio is capital-structure-neutral, it can be effectively used khổng lồ compare organizations with different ranges of leverage, which was not possible in the case of the simpler ratios.