A metric for deriving the value of a business. Meaning Enterprise Value divided by Earnings Before Interest, Taxes, Depreciation and Amortization, it compares the value of a company, including debt and other liabilities to its actual earnings, not including non-cash assets. The resulting enterprise multiple can be used to compare one company to another within the same industry, since the calculation is independent of the capital structure of a company. A lower enterprise multiple may indicate that a company is undervalued.

Use EV/EBITDA in a sentence

You may want to try and break down your ev/ebitda to make sure that your time is being wisely spent on the project,.

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The ev/ebitda was really interesting to me and I wondered what it meant for me because our business did not have good value.

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