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Definition of 'EBITDA to sales ratio'
A financial metric used to assess a company's profitability by comparing its revenue with earnings. More specifically, since EBITDA is derived from revenue, this metric would indicate the percentage of a company is remaining after operating expenses.
Sometimes referred to as "EBITDA margin".
Calculated as:
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Investopedia explains 'EBITDA to sales ratio'
For example, if XYZ Corp's EBITDA is $1 billion and its revenue is $10 billion, then its EBITDA to sales ratio is 10%. Generally, a higher value is appreciated for this ratio as that would indicate that the company is able to keep its earnings at a good level via efficient processes that have kept certain expenses low.
However, when comparing company's EBITDA margin, make sure that the companies are in related industries as different size companies in different industries are bound to have different cost structures, which could make comparisons irrelevant.
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Search results for 'EBITDA to sales ratio'
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http://www.investopedia.com/articles/fundamental-analysis/08/performance-profitability-value.asp
... to the previously discussed multiples, investors like to see a low EV/EBITDA multiple,
which ... (For more insight, see Use The Price-To-Sales Ratio To Value ...
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http://stocks.investopedia.com/stock-analysis/2011/Whirlpool-Or-Newell-Rubbermaid-Which-Is-The-Better-Buy-WHR-NWL-ABD-BEAM-AVY1020.aspx
... Newell Rubbermaid's EBITDA margin is considerably higher than Whirlpool's, yet its
total debt is identical at ... The second valuation is the price-to-sales ratio. ...
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http://stocks.investopedia.com/stock-analysis/2011/Winn-Dixie-Drives-Sales-Now-Time-For-Profits-WINN-KR-SVU-SWY1102.aspx
... A Dirt Cheap Business Winn-Dixie sales have sold off over ... trades at a comparable
multiple of nearly five times EV/EBITDA. ... see How To Use The P/E Ratio And PEG ...
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http://stocks.investopedia.com/stock-analysis/2010/Serious-Reservations-About-Open-Table-Valuation-OPEN-WEYS-DTPI-EPAX-HWKN-LULU0809.aspx
... Lululemon (Nasdaq:LULU), a stock I consider extremely overvalued, trades at a
price-to-sales ratio of 5.6 with an enterprise value 20.4 times its EBITDA. ...
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http://www.investopedia.com/university/ratios/investment-valuation/ratio8.asp
... of 15.7, which means that it would take roughly 16 years for earnings (assuming
EBITDA doesn't ... Click here to return to the Financial Ratio Tutorial main menu. ...
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http://www.investopedia.com/university/ratios/investment-valuation/default.asp
... This includes revenue, gross margin, operating cash flow, EBITDA, pro forma ...
Price/Earnings To Growth Ratio; Investment Valuation Ratios: Price/Sales Ratio; ...
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http://stocks.investopedia.com/stock-analysis/2009/Check-Out-The-Healthy-Portfolio-CHSI-MGLN-CYH-UHS-CAH0819.aspx
... Cutting those stocks with a price-to-sales ratio above four - National Health Investors
Inc ... of leverage, I'm axing those that have total debt greater than EBITDA ...
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http://www.investopedia.com/articles/stocks/08/medical-tech-investment.asp
... Investors new to medical technology should also realize that, for better or worse,
the price-to-sales ratio is a commonly used metric for these stocks ...
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http://stocks.investopedia.com/stock-analysis/2011/Huntsman-Is-Priced-To-Move-HUN-LYB-BASFY-BAYRY-DOW1225.aspx
... Company. Price-To-Sales Ratio. ... Its third quarter results were the best ever with
revenues, adjusted EBITDA and adjusted net income all higher than last year. ...
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http://www.investopedia.com/university/ratios/investment-valuation/
... This includes revenue, gross margin, operating cash flow, EBITDA, pro forma ...
Price/Earnings To Growth Ratio; Investment Valuation Ratios: Price/Sales Ratio; ...
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