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EV/EBITDA Explained: A Key Valuation Multiple for Investors

Valutico

This ratio offers insight into a companys profitability and relative value by comparing its total worth (Enterprise Value, encompassing debt and equity) to its operational earnings (EBITDA). The multiple is calculated as Enterprise Value (EV) divided by EBITDA. What is Enterprise Value?

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M&A Valuation Methods: Your Essential Guide with 7 Key Methods

Valutico

Analysts use financial metrics and multiples such as Price to Earnings (P/E), Price to Book (P/B), Enterprise Value to Sales (EV/Sales), Enterprise Value to EBITDA (EV/EBITDA), and Price to Book (P/B) ratios derived from trading data of similar public companies or deal pricing data of similar M&A transactions.

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M&A Terms Every Business Owner Should Know

Class VI Partner

Discounted Cash Flow Value Discounted Cash Flow Value refers to the calculation of a company’s Enterprise Value on the basis of its ability to generate free cash flow over time. EBITDA Multiple EBITDA Multiple refers to the multiple of EBITDA used to determine a company’s enterprise value.