EBITDA Yield or EBITDA to EV

EBITDA Yield  = Earnings  before interest, taxes, depreciation and amortization (EBITDA) / Enterprise Value (EV).

It is the inverse of the EV to EBITDA.

The screener only has EV to EBITDA available to screen with (As one of the four Factors with sliders) but EBITDA Yield is available as an output output.

 

Use it to implement the Acquirer’s Multiple investment strategy

You can use this ratio to implement the Acquirer’s Multiple investment strategy as explained in the excellent book by Tobias Carlisle called The Acquirer's Multiple: How the Billionaire Contrarians of Deep Value Beat the Market.

 

What is The Acquirer’s Multiple?

The Acquirer’s Multiple is a valuation ratio that compares a company’s Earnings Before Interest Taxes Depreciation and Amortisation (EBITDA) to its Enterprise Value.

It thus calculates the cost – EV - an outside investor would have to pay to acquire a company’s operating profits.

 

How you can use the ratio

Available as a screening ratio: No (use EV to EBITDA)

Available as an output column ratio: Yes

 

How to select the highest EBITDA to EV companies

To find companies with the highest EBITDA Yield in the screener select the EV to EBITDA ratio and set the slider from 0% to 10%.

 

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