Overview
Enter a company's enterprise value and EBITDA to calculate the EV/EBITDA multiple: Enterprise Value ÷ EBITDA, formatted as a multiple like "5.00x". This is one of the most commonly quoted valuation multiples because it compares total company value (equity plus debt, minus cash) against a profitability measure that's less distorted by financing structure or tax rate than net income or P/E - which makes it a common way to compare companies with different amounts of debt. EBITDA cannot be zero, since dividing by zero would produce an undefined multiple rather than a real number - the calculator rejects that input with a clear message instead of showing Infinity. Useful for a quick relative-valuation check, comparing an acquisition target's multiple against industry peers, or sanity-checking a reported deal multiple. Runs entirely client-side, and this is an informational estimate, not financial advice.
Best for: Comparing an acquisition target's valuation multiple against industry peers
How to use this tool
- Enter enterprise value. Total company value: market cap plus debt and minority interest, minus cash.
- Enter EBITDA. Earnings before interest, taxes, depreciation, and amortization - must be non-zero.
- Read the multiple. Enterprise Value ÷ EBITDA, formatted as a multiple such as "5.00x".
Frequently asked questions
Dividing by zero EBITDA would produce an undefined result (mathematically, infinity), which isn't a meaningful multiple. The calculator rejects a zero EBITDA input with a clear error message instead of showing Infinity or an unhandled value.
It varies enormously by industry, growth rate, and market conditions - a multiple that looks expensive in one sector can be cheap in another with structurally higher growth or margins. This tool computes the multiple itself and leaves the comparison against peers or historical norms to you.
EV/EBITDA compares total company value (which includes debt) against a pre-interest, pre-tax profitability measure, making it more comparable across companies with different capital structures or tax situations than P/E, which uses equity value divided by after-interest, after-tax earnings.