Technical Question Kinda Confused
If debt goes up, what happens to ev/ebitda, p/e?
I know P/E goes down bc debt increasing, causes less room for error, and so at the moment debt is rasied, equity value goes down.
Technically EBITDA multiple is not capital structure dependent, so by this logic if debt goes up, cash goes up which cancel, but what happens to equity (and therefore enterprise value)?
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