EV/EBITDA
Also called: enterprise value to EBITDA
Enterprise value divided by EBITDA — a capital-structure-neutral valuation multiple for comparing companies with different debt loads.
Enterprise value (market cap plus debt minus cash) is the cost to buy the whole business; EBITDA is earnings before interest, taxes, depreciation and amortization, a proxy for operating cash flow. EV/EBITDA values the entire enterprise against its operating profit, so it isn't distorted by how a company is financed — useful for comparing across capital structures and for buyout math.
It's a favorite in M&A and for capital-intensive industries. A lower multiple is cheaper, but always relative to growth and sector norms; EBITDA also ignores real costs like capex, so it's not a complete picture.
On StockSetups
EV/EBITDA is a screener field on StockSetups, giving a debt-aware valuation read alongside the simpler P/E and P/S.
Related terms
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