ebitda

hello team. i am confusing myself badly and would appreciate your help here. example: Buyer offers seller $1B TEV, cash-free debt-free basis. Seller has $200M of existing debt on the business and $100M in cash. So prior to or at close, seller uses the $100M of cash to pay down debt to now $100M. but...

02 Aug 2023

I have 2 questions regarding multiples: 1. is it possible to include EBITDA growth in multiples? 2. how can I calculate the EBITDA margin with multiples only?

09 May 2023

Let's say the corporate tax rate drops from 21% to 15%. How does that affect a company's EBITDA multple? Would the EBITDA multiple go up? Why?

02 Jan 2023

what does "management ebitda" mean? have seen that come up a few times. is that just the same as reported ebitda? and not adjusted ebitda? thanks so much team!!

08 Nov 2022

hi team - is this possible? looking at a balance sheet of a PE backed portco (recently acquired) and trying to figure out what the purchase price was. long-term debt is $200M Total stockholder equity is $500M.... of that $500M, $10M is common stock and $490M is additional paid-in capital To back...

19 Oct 2022

hi guys - what exactly is the difference here? is whitespace a subset of TAM? so if TAM is $1B, whitespace might be $100M that's actually serviceable to a Company? from what i understaND, TAM is the total revenue opportunity assuming 100% market share. so is whitespace the portion of that pie that...

15 Jun 2022

hi everyone - is ARR listed out somewhere on financial statements for public cos? i only see total revenue. is there a way to look at 10-k, 10q, etc. and figure out ARR if it's not explicitly stated? thanks so much!

04 Apr 2022

Hi guys. Easy questions below. 1. what’s the difference between annual recurring revenue and run rate? Aren’t these basically the same? 2. I don’t understand when I’m looking at a CIP when they say “projecting 2023 run rate revenue of $10m.” Why wouldn’t you just say 2023 revenue of...

24 Mar 2022

Hi everyone. Can someone please help answer my conceptual questions below? Thanks so much 1. As a buyer, imagine I am evaluating a target. I am trying to figure out how much to pay for the business. I can see the target’s latest financing round and valuations. What is more important for me to look...

18 Mar 2022

hi team... 1st scenario: assume I am a buyer assessing a potential target. this potential target had a recent financing round and you can see both the pre and post money valuation from the round... which metric (pre or post) would be more relevant for helping me, the buyer, determine how much i...

18 Mar 2022

hi all. can someone please explain intuitively what cash burn means? and what this means in relation to ebitda? if a company is burning cash, does that mean there is no ebitda? for example, how would one interpret "10M cash burn" ? thanks so much...

22 Feb 2022

hey guys - what's the difference between financeable EBITDA and.... non financeable EBITDA? and what are the differences in the calcs? been reviewing some buyside / LBO / lender model materials and keep seeing this term "financeable ebitda" thanks all!

16 Feb 2022

if ebitda is a non-gaap metric, why do i sometimes see "gaap vs. cash ebitda"? very confused here. how can there be a "gaap" ebitda? and then what's cash ebitda? thanks team! appreciate all the help

15 Feb 2022

hi team. i'm looking at an EBITDA bridge right now and I am confused. on the lefthand side, we start with Q3 2020 LTM EBITDA. On the far right side, the bridge ends at full year 2020A EBITDA. In between obviously there are a bunch of steps. How can you bridge from Q3 2020 LTM EBITDA to full year...

15 Feb 2022

Hey, I have an interview and I really can't understand why we add debt to equity value on the enterprise value. Doesn't the equity value already automatically discount the debt and thus only the real amount to be paid is left? I read that the buyer always was to pay for the debt but I just can't...

10 Dec 2021

Hi All, I am estimating the enterprise value of a private company using the market approach and more specifically the EV/Ebitda and EV/Sales multiples(not transaction). My first question is; do i have to adjust the enterprise value for Discount for lack of Marketability since i am using multiples of...

26 Mar 2021

Is it possible to use the current EBITDA margin of a company to forecast its future EBITDAs? thank you for your response

28 Nov 2020

Question on how REIT rental revenue that been earned but not paid. I am underwriting a borrower that has seen ~90% rental collections during the pandemic. The proposed definitions for EBITDA and NOI in the credit agreement adjust out "non-cash" items. My question though is whether non-cash items...

17 Sep 2020

What does Cash EBITDA mean? What's the **difference **with EBITDA? Any example would be very much appreciated.

26 Nov 2019

When valuing a company through the comparables methodology, why do we apply the transaction multiple result to LTM EBITDA and trading multiples result to forward EBITDA?

30 May 2019

Stumbled across Bull And Bear Clothing when searching for an "I

26 Sep 2018

So a colleague and I were bored at work and started brainstorming different phrases that EBITDA could stand for. The best we came up with was: Everyone's Busy If The Director Asks Can anyone else think of a funny / applicable definition for this ubiquitous finance term?

28 Jun 2018

Interview question I got--Why would two similar companies, same industry, same growth prospects have different ebitda multiples? What about different P/E multiples? P/E or EV/EBITDA Multiples for Similar Companies When looking at two companies in the same peer group, with similar profiles and the...

29 Mar 2018

Hi guys, I'm trying to learn some basic IB technicals and was really hoping for help with a few concepts please: 1. Isn't it better to value a company using EBIT rather than EBITDA because EBIT accounts for DA which is significant expense on the income statement? 2. Do people in investment banks...

11 Nov 2017

Monkeys - which of the two approaches are you using to calculate EBITDA, top down or bottom up? What line of work are you in? I'm in corporate banking and have always gone the top down route (I.e. Revenues - cogs - opex +/- non-cash and non-recurring items embedded within the aforementioned...

27 Jun 2017

Bubble Gum Co.’s operating profit is 5,000. It has a litigation charge of 1,000 in SG&A. D&A is 500. What is EBITDA? I thought the answer would be $4,500. EBIT or operating income = Revenue -Expenses so $5000-$1000 of litigation expense. and then add D+A which would be $4000+$500=$4,500 turns out...

26 May 2017

Hello, Could anybody perhaps offer insight on some of the more nuanced tricks private equity firms use to create value in their portfolio companies? For instance, do they sell all real estate and lease instead, try to reduce underfunded pensions in some way, do other accounting / finance tricks to...

16 Apr 2017

I'm working one morning and a friend of mine from when we were in banking (he's in PE, I left PE for a startup) sends me a note with a subject that says "Which banker do you think I was behind this morning?" I opened the email and there's just a picture. I literally fell on the floor from laughing...

13 Apr 2017

I am working on the factory financial model. Therefore, depreciation costs of the Plant and Equipment are included in COGS, as these fixed assets are used in the direct production of the inventory. My question is - as far as all the fixed assets company owns is just an equipment that is used in...

13 Sep 2016

I am working on the factory financial model. Therefore, depreciation costs of the Plant and Equipment are included in COGS, as these fixed assets are used in the direct production of the inventory. My question is - as far as the company owns only assets that are used in production (and no other...

13 Sep 2016

Fairly simple exercise here: How do YOU pronounce EBITDA, phonetically? I'm partial to "e-bit-dah" with a an emphasis on the "E" and "dah" being pronounced almost like the Russian word. How Do You Say EBITDA? Consensus among our users is that EBITDA should be pronounced as: ee-bit-dah The below...

21 Aug 2015

Do we use an EBITDA figure that has been adjusted for one-time, non-recurring items in the DCF calculation? If not, where do these adjustments go? Much appreciated.

27 Aug 2014

Noob intern here arguing with other noob interns. So us noobs understand that you simply add interest, taxes, depr. and amor. back to net income to get EBITDA. However, we're looking at a company's income statement and there's income tax along with payroll taxes under operating expenses. My argument...

23 May 2014

If there are two companies with same industry, same region, similar cap structure, Wacc/discount rate, same capex, working capital. One has a higher margin on its sales, one has a lower margin on its sale. Which would be trading at a higher EBITDA multiple if their EBITDA is the same? I'm trying to...

07 Feb 2014

Moderator note (Andy): this is a post from 2010 but squawkbox suggested its relevancy remains and can be very useful for those going through FT & SA interviews. "Don't beat it to hell because it's missing some small details, but it's good for what someone will need in the "hotseat" during the...

19 Jan 2013

Have you ever wondered how investment banks or financial advisors calculate a firm’s value exactly? In order to evaluate company X during an M&A transaction, a peer group of comparable companies (Company A and Company B) have to be selected. Subsequently, various key performance indicators have to...

28 Oct 2012

Hi guys, Could someone please help explain the difference of when to use EV/EBIT vs EV/(EBITDA-capex)? I know you generally use EV/EBIT for companies with high capex, why though? Because of the high D&A, but don't you want to account for that? like EBITDAR for airlines, gaming/casinos, etc? I guess...

29 Jun 2013

So, I'm working on a report for my school's investment club and got most of my data from a Bloomberg terminal. After realizing I needed a few more numbers while already back in my dorm, I logged on to ThomsonOne. Many of the numbers are different between the two services for apples to apples...

06 Feb 2013

If I know a company was acquired for 8x TTM EBITDA recently, does this mean that the company's equity was purchased for 8x TTM EBITDA, or does the 8x refer to the company's EV, from which I'd need to back out the debt and cash to arrive at the price paid for the equity? Many thanks!

21 Nov 2012

Hi Guys, Looking at a bank book, but am stuck on a term - Can anyone help me quickly on the difference between ebitda and property ebitda? Thanks

20 Sep 2012

Hello, How would you compute historical EV/EBITDA multiples for a listed company in order to compare them with the actual multiple? Let's say the current date is 31 Dec. 2011, the company fiscal year ends on 31 Dec., hence to compute the actual 2011 multiple I use the market capitalization and...

02 May 2012

Hey guys I am just a little confused why EBITDA is used so much? I understand it may be appropriate to ignore depreciation charges when valuing certain companies but why would you ignore interest and tax payments? These charges are real cash outflows that cannot be avoided so I am curious what the...

20 May 2011

I dont really get EBITDA. It is earnings before all that so I assumed that it contained D and A. but if it excludes D and A, how can we subtract D and A to get Ebit? Wouldnt that be subtracting a non existent thing? Thanks!

21 Jan 2012

Currently working on valuing a very indebted retail company for potential takeover and having serious troubles. Operating Income is negative, EPS is negative, Net Income is negative, EBITDA is negative and jumping all over the place, Retained Earnings is negative (and growing), Cash & CE is...

15 Dec 2011

Obviously the difference between the two multiples is D&A, so for a company/industry with lots of D&A, should you use EBITDA or not? I could see it being argued either way--i.e. if D&A is a large factor, don't use EBITDA because that ignores an important aspect of the company's financials...or USE...

30 Sep 2011

Anyone know what this is/why this is used? Google says this is EBITDA minus the SGA. Is that correct?

31 Aug 2011

Hey, I know it is easy to fluff up anything in a resume or cover letter. ie shredding paper as an intern: "regularly maintaining corporate security process" (you all know what im talking about) anyway, Im interning in M&A now and want to know if reporting deal size's I worked on is what recruiters...

02 Mar 2011

I need the ratio for a quick and dirty calculation, if someone can provide a ball park number that would be great. If not, directions to sources (Chinese equivalent of google finance/EDGAR etc.) where I can get info to build my own comp sheet is fine too. Thanks.

21 Feb 2011

Check out Dom Mazzetti talking about this accounting internship in "NYC". www.MikeandGian.com youtube.com/DomMazzetti @MikeandGian

12 Jan 2011

I don't have access to bloomberg. Can someone PLEASE look up and tell me the Forward EBITDA and/or Forward EBITDA Multiple for Tiffany's co. -TIF , Guess co. -GES and Ralph Lauren -RL Thanks!

08 Dec 2010