Formula
EV/EBITDA = Enterprise Value / EBITDA
How to Interpret
EV/EBITDA compares a company’s Enterprise Value (market cap plus net debt and other adjustments) with its EBITDA. It is similar to a P/E ratio but uses a pre‑interest, pre‑tax profit metric and capital‑structure‑neutral value measure. Lower multiples may indicate undervaluation, all else equal.