Series 79: Debt/EBITDA Ratio

Taken from our Series 79 Top-off Online Guide

Debt/EBITDA Ratio

The debt/EBITDA ratio reflects the amount of debt as compared to earnings. Here, EBITDA is used as a proxy for cash flow and is used to determine, very roughly, the number of years of earnings required to pay off the company’s debt completely. The ratio is expressed as:

total debt / EBITDA

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