would you rather have $100 million of cash or $100 million of EBITDA?
would you rather have $100 million of cash or $100 million of EBITDA?
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uhhh easily $100 million of ebitda? Buyers dont look at 10x cash multiples for a purchase price. Further $100m in ebitda will give you that every year, $100m cash one time?
$100m ebitda is a very successful company from an operating standpoint. I'm not sure if we're missing other factors, but this seems like an easy decision.
But actually, it depends on the context. Are we talking about whether a business generates $100m in EBITDA per year or cash flows $100m? I'd rather have a Company throw off the cash, because I think EBITDA is easier to mess with than straight up cash generation.
Cash flow is king.
What's the CAPEX, Warren Buffett?
You're on the right thread bro. Johnny Cashflow knows what's up.
Like those above, unsure whether you mean a one off hit of cash or a yearly cash flow.
EBITDA is not a proxy for cash flow so I would absolutely opt for $100m in yearly cash flow.
While the answer is always "it depends", but it won't be hard to find a buyer to pay, say 2x EBITDA, and I pocket $200M, while no one would even pay 1.001x cash.
Depends on my ownership over the $100MM of EBITDA. If my ownership is 1%, then ya, straight up a pile of $100MM in cash. But if I’m the proud majority owner of a $100MM EBITDA business, for sure the business. Sell that shit for 4.0x, and pocket roughly twice as much cash vs. the $100MM in cash, taxes ignored.
are either the cash or EBITDA recurring every year?
Depends on the mutliple you can sell at. If you are in an industry that consistently sells for 10x EV/EBITDA values then yes absolutely take the 30MM EBITDA to get a huge payout if you sell the firm.
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