Formula
EV / EBITDA
=
Enterprise Value
EBITDA (TTM)
- Enterprise Value = Market Cap + Total Debt − Cash & Equivalents.
- EBITDA = Earnings Before Interest, Taxes, Depreciation & Amortization — a proxy for operating cash flow.
Alpha Finance
Current Value TTM
Enterprise Value
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EBITDA (TTM)
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EV / EBITDA
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EV/EBITDA Drivers —
Table
| Year | EV/EBITDA |
|---|
Definition
EV/EBITDA compares a company's enterprise value to its EBITDA (Earnings Before Interest, Taxes, Depreciation & Amortization). It is one of the most widely used valuation multiples because it is capital-structure neutral and unaffected by depreciation differences. A low multiple may indicate undervaluation, while a high multiple reflects strong growth or premium quality. The ideal range varies by sector — capital-intensive industries like energy trade at 5–8×, while tech and healthcare can trade at 15–20×.
ValueEV/EBITDA < 8×
Fair8 – 13×
Premium13 – 19×
Expensive> 19×
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