EBITA

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DEFINITION of 'EBITA'

An acronym for "earnings before interest, taxes and amortization." EBITA is most commonly used when equating profitability and efficiency ratios for firms. The necessary figures for calculating EBITA can be found on a company's income statement.

BREAKING DOWN 'EBITA'

The more popular figure, EBIT, is used by investors to guage a possible investment. EBITA is largely ignored by investors due to its inclusion of the intangible value of amortization. Therefore, EBITA is used more often by companies on a internal basis.

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