Compares a company's total value to its cash earnings minus non-cash expenses.
Formula: EV/EBITDA = Enterprise Value / EBITDA
How to read it: < 10× = cheap · 10–15× = fairly valued · > 15× = expensive (the library's generic rating thresholds). Normal ranges differ by sector; not meaningful for banks and insurers.
Heavily used in private equity and mergers/acquisitions to value a business regardless of its capital structure.