EV/EBITDA Calculator

About this calculator

This calculator divides a company's enterprise value (market cap plus debt minus cash) by its EBITDA (earnings before interest, taxes, depreciation and amortization) to produce the EV/EBITDA multiple, a capital-structure-neutral measure of how expensive a company is relative to its operating cash-generating ability. A lower multiple can suggest a company is cheap relative to peers; a higher one suggests the market is pricing in stronger growth or quality.

Equity research analysts, private equity and M&A professionals, and value investors use EV/EBITDA to compare companies with different debt levels or tax situations — something the plain P/E ratio can't do since P/E ignores capital structure. Enter enterprise value and EBITDA to get the multiple.