Mergers & Acquisitions

Resources: Glossary

Don’t be confused or intimidated by any terms or abbreviations in the M&A world. You’ll find answers here.

EBITDA

Definition

A measurement of the cash flow of a company which includes earnings before interest, taxes, depreciation, and amortization.

See Also

Cash flow, EBIT, net income, SDE.

Tips

EBITDA stands for earnings before interest, taxes, depreciation, and amortization. EBITDA is an indicator for gauging a company’s financial performance. It is often used to determine a company’s profitability and to compare the performance of companies with each other. EBITDA does not include the owner’s salary.

Related Resources

EBITDA | Definition, Formula & Example – A Complete Guide

Seller’s Discretionary Earnings (SDE) | Definition & Examples

Should I use SDE or EBITDA to value a business?