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EV / EBITDA Ratio

EV / EBITDA Ratio

Nick Name
Enterprise Multiple
Abbreviation
EBITDA Multiple
Parent term
Valuation

The EV / EBITDA ratio is a valuation metrics that divides Enterprise Value by EBITDA

  • EV / EBITDA helps compare companies in the same industry that are based in different countries
  • It helps eliminate different tax, accounting and financing issues that usually differ across countries
  • A lower EV / EBITDA ratio usually means the stock is cheaper
  • A higher EV / EBITA ration usually suggests that a stock is more expensive

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