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EV/EBITDA Template

EV/EBITDA Template

This EV/EBITDA template guides you through the calculation of EV/EBITDA using figures from an Income Statement.

Below is a preview of the EV/EBITDA template:

EV/EBITDA Template Screenshot

 

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EV/EBITDA Template

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EV/EBITDA is a ratio that compares a company’s Enterprise Value (EV) to its Earnings Before Interest, Taxes, Depreciation & Amortization (EBITDA).  The EV/EBITDA ratio is commonly used as a valuation metric to compare the relative value of different businesses.

The ratio of EV/EBITDA is used to compare the entire value of a business with the amount of EBITDA it earns on an annual basis.  This ratio tells investors how many times EBITDA they have to pay, were they to acquire the entire business.

The most common uses of EV/EBITDA are:

  • To determine what multiple a company is currently trading at
  • To compare the valuation of multiple companies
  • To calculate the terminal value in a Discounted Cash Flow DCF model
  • In negotiations for the acquisition of a private business
  • In calculating a target price for a company in an equity research report

 

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