Net Debt To EBITDA Ratio

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Dictionary Says

Definition of 'Net Debt To EBITDA Ratio'

A measurement of leverage, calculated as a company's interest-bearing liabilities minus cash or cash equivalents, divided by its EBITDA. The net debt to EBITDA ratio is a debt ratio that shows how many years it would take for a company to pay back its debt if net debt and EBITDA are held constant. If a company has more cash than debt, the ratio can be negative.
Investopedia Says

Investopedia explains 'Net Debt To EBITDA Ratio'

The net debt to EBITDA ratio is popular with analysts because it takes into account a company's ability to decrease its debt. Ratios higher than 4 or 5 typically set off alarm bells because this indicates that a company is less likely to be able to handle its debt burden, and thus is less likely to be able to take on the additional debt required to grow the business. Ultimately, however, it depends on the benchmark of the industry you are looking at.
Search results for

'Net Debt To EBITDA Ratio'

  • Dresser Rand Analyst Day Review

    http://stocks.investopedia.com/stock-analysis/2010/Dresser-Rand-Analyst-Day-Review-DRC1117.aspx
    ... The company was a typical leveraged buyout, with a net debt to capital ratio of
    56% and a net debt to EBITDA ratio of 4.8 at the end of 2004. ...

  • Beware False Signals From The P/E Ratio

    http://www.investopedia.com/articles/fundamental-analysis/10/false-signals-pe-ratio.asp
    ... carried the equivalent of $3 per share of net debt on its ... EPS this year of $1, its
    P/E ratio would be ... with enterprise value in the numerator and EBITDA in the ...

  • A Clear Look At EBITDA

    http://www.investopedia.com/articles/06/ebitda.asp
    ... of 2 - more than enough to pay off debt. ... Its proponents argue that EBITDA offers
    a clearer reflection of ... in prior years; this variation can distort net income. ...

  • Kadant Company: Former Spin-Off Does Good

    http://stocks.investopedia.com/stock-analysis/2012/Kadant-Company-Former-Spin-Off-Does-Good-KAI-TMO-CVO-GLPW0215.aspx
    ... third quarter with net cash of $30.7 million, its highest level of third quarter
    net cash in some time. Impressive is the fact its debt/EBITDA ratio was 0.36 ...

  • EBITDA: Challenging The Calculation

    http://www.investopedia.com/articles/analyst/020602.asp
    ... depreciation and amortization) back to net income and ... of required debt payments yields
    a debt coverage ratio ... Factoring out the "ITDA" of EBITDA was designed to ...

  • Destination Maternity Delivers Growth

    http://stocks.investopedia.com/stock-analysis/2011/Destination-Maternity-Delivers-Growth-DEST-M-KSS-SHLD-GMAN0308.aspx
    ... However, this ratio is based on trailing twelve-month earnings ... Its enterprise value
    is just 5.5 times EBITDA. At the end of December, net debt was $6.3 million ...

  • EVA: Overview | Investopedia

    http://www.investopedia.com/university/EVA/EVA1.asp
    ... or ROIC), Operating Income Growth, Ratio of: Entity value ÷ EBITDA. ... profit (EBIT)
    into cash-bashed net operating profit ... as balance-sheet (equity or debt) items. ...

  • Relative Valuation: Using Stocks To Value Other Stocks

    http://www.investopedia.com/articles/stocks/11/relative-valuation-stocks-valuing-stocks.asp
    ... If that company has $500 in net debt on the balance sheet, its EV is $1500 and its
    debt-adjusted P ... Normally enterprise value should be compared to EBITDA. ...

  • Top Things To Know For An Investment Banking Interview

    http://www.investopedia.com/articles/financialcareers/10/investment-banking-interview.asp
    ... Capital Expenditures – Increases in Net Working Capital ... of the equity of the firm,
    ignoring debt. ... common multiples is the enterprise multiple (EV/EBITDA). ...

  • Stocks Seeing Selling Pressure

    http://stocks.investopedia.com/stock-analysis/2010/Stocks-Seeing-Selling-Pressure-CODI-MVC-Y-ENH0715.aspx
    ... 1.3 and a rich 12 times EV/EBITDA ratio ... MVC has very little debt and an excellent
    management team ... Trading below the net asset value of its marketable investment ...

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