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Glossary

EV/EBITDA

How many years of EBITDA (approximate operating cash generation) fit in the value of the whole company, debt included.

What it is

How many years of EBITDA (approximate operating cash generation) fit in the value of the whole company, debt included. Shown on the stocks pages.

How Dados B3 calculates it

(market value + net debt) ÷ the year's EBITDA, with the market value on the filing date. Without depreciation in the statements the number is not published. It does not exist for banks and insurers.

Example

Illustrative example, with made-up numbers to keep the arithmetic easy: Market value R$ 800 million and net debt R$ 200 million: enterprise value R$ 1 billion. With EBITDA of R$ 250 million, EV/EBITDA = 1,000 ÷ 250 = 4.

What to watch for when reading it

• Other sites use trailing 12-month EBITDA and today's price; this one uses the fiscal year and the filing-date price, so the numbers differ.
• EBITDA ignores investment: a company that must spend a lot to keep running looks better than it is.
• Compare within the same sector.

See also

• EBITDA
• Enterprise value (EV)
• Net debt / EBITDA

Methodology · Guide · All indicators

Educational content to understand what each number means. It is not a recommendation to buy or sell.