Debt/EBITDA Ratio,
What is Debt/EBITDA Ratio?
Debt / EBITDA (Interest, Tax, Depreciation and Pre-Deductible Income) is an index available for the amount of income generated before meeting the costs of interest, tax, depreciation and deduction and the repayment of loans. Debt / EBITDA assesses a company's debt repayment capacity. A high ratio of results can indicate that a company is heavily indebted.
- Lenders, valuation analysts and investors use the debt / EBITDA ratio to measure a company's liquidity and financial health.
- The key figures show the cash flow available to the company to meet its debt and other obligations.
- A decrease in the debt / EBITDA ratio over time indicates that the company is repaying the loan or increasing profits, or both.
Literal Meanings of Debt/EBITDA Ratio
Debt:
Synonyms of Debt
money owing, tally, account, financial obligation, bill, amount due, outstanding payment
EBITDA:
Meanings of EBITDA:
Earnings before interest, taxes, depreciation and deductions (used as an indicator of the company's gross profit).
Ratio:
Meanings of Ratio:
A quantitative relationship between two quantities that indicates how many times one value contains or is included in another.
Sentences of Ratio
The employment ratio between men and women is 8 to 1.
Synonyms of Ratio
correlation, comparative number, balance, relationship, quantitative relation, proportion, comparative extent, correspondence
Debt/EBITDA Ratio,
How Do You Define Debt/EBITDA Ratio?
Will Canton specializes in investment and business legislation and regulation. Prior to that, he was a senior author at Investopedia and Capital Wire, and received an MA in Economics from New York University and a PhD in Philosophy in English Literature from The New School for Social Research.
- Lenders, appraisers and investors use the loan / ETDA ratio to measure a company's liquidity and financial health.
- The reason is the actual cash flow that the company has to meet its debts and other obligations.
- The debt / ETDA ratio, which decreases over time, indicates that the company will either go into debt or increase its profits, or both.
Literal Meanings of Debt/EBITDA Ratio
Debt:
Meanings of Debt:
Amount owed or amount owed.
Synonyms of Debt
score, tab, debits, dues, arrears, check, charges
EBITDA:
Meanings of EBITDA:
Earnings before interest, taxes, depreciation and forgiveness (used as an indicator of the company's gross profit).
Ratio:
Meanings of Ratio:
A quantitative relationship between two quantities that indicates how many times one value contains or includes another.
Synonyms of Ratio
percentage, comparative number/extent, quotient, fraction
