Net Debt to EBIT

Net Debt to EBIT = (Long-term debt + Short term debt – Cash) / Earnings before interest and taxes (EBIT)

This ratio shows you how able a company is to pay interest and capital on its net debt outstanding.

The smaller the ratio (means the company has got a low amount of debt compared to EBIT) the stronger the company's ability to be able to meet its interest and capital payments.