Earnings Before Interest, Depreciation And Amortization - EBIDA


DEFINITION of 'Earnings Before Interest, Depreciation And Amortization - EBIDA'

A measure of the earnings of a company that adds the interest expense, depreciation and amortization back to the net income number, but takes the tax expense into consideration. This measure is not as well known or used as often as its counterpart, earnings before interest, taxes, depreciation and amortization (EBITDA).

Earnings Before Interest, Depreciation And Amortization (EBIDA)

BREAKING DOWN 'Earnings Before Interest, Depreciation And Amortization - EBIDA'

EBIDA is considered to be a more conservative valuation measure than EBIDTA because it includes the tax expense in the earnings measure. The EBIDA measure removes the assumption that the money paid in taxes could be used to pay down debt, an assumption made in EBIDTA. This debt payment assumption is made because interest payments are tax deductible, which, in turn, may lower the company's tax expense, giving it more money to service its debt. EBIDA, however, does not make the assumption that the tax expense can be lowered through the interest expense and, therefore, does not add it back to net income.

  1. Earnings Before Interest & Tax ...

    An indicator of a company's profitability, calculated as revenue ...
  2. Amortization

    1. The paying off of debt in regular installments over a period ...
  3. Income Tax

    A tax that governments impose on financial income generated by ...
  4. Earnings Before Tax - EBT

    An indicator of a company's financial performance calculated ...
  5. Net Income - NI

    1. A company's total earnings (or profit). Net income is calculated ...
  6. EBITDA - Earnings Before Interest, ...

    Learn what EBITDA is, watch a short video to learn more and with ...
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