What is a good EBITDA ratio?

What is a good EBITDA ratio?

What is a good EBITDA? An EBITDA over 10 is considered good. Over the last several years, the EBITA has ranged between 11 and 14 for the S&P 500. You may also look at other businesses in your industry and their reported EBITDA as a way to see how you measuring up.

What is a healthy debt to EBITDA ratio by industry?

In some industries, a debt/EBITDA of 10 could be completely normal, while in other industries a ratio of three to four is more appropriate.

What does a negative debt to EBITDA ratio mean?

If EBITDA is negative, the ratio of corporate debt to EBITDA will fall under zero, where the deeper the ratio falls under zero, the worse will be corporate credit quality. Thus, the ratio of corporate debt to EBITDA is a non-monotonic relationship.

Can Net debt EBITDA be negative?

The Formula for Net Debt-to-EBITDA Is 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.

Is high EBITDA good or bad?

Because it eliminates the effects of financing and accounting decisions, EBITDA can provide a relatively good “apples-to-apples” comparison. For example, EBITDA as a percent of sales (the higher the ratio, the higher the profitability) can be used to find companies that are the most efficient operators in an industry.

What is good EBITDA net debt ratio?

Generally, net debt-to-EBITDA ratios of less than 3 are considered acceptable. The lower the ratio, the higher the probability of the firm successfully paying off its debt. Ratios higher than 3 or 4 serve as “red flags” and indicate that the company may be financially distressed in the future.

What is Apple’s EBITDA?

Apple Inc’s forecast of earnings before interest, tax, depreciation, and amortization (EBITDA) was 120.2 billion U.S. dollars in 2021, and predicted to increase to 134.4 billion U.S. dollars in 2023. The technology firm’s performance in both hardware and software makes it one of the most valuable companies worldwide.