Value a company with the EBITDA multiple method: enterprise value, reverse solver, acquisition comparator, sensitivity analysis, and an industry multiple reference table.
⚠️ Not investment advice. All results on this page are educational estimates for learning purposes. Real investment or business sale-and-purchase decisions require a certified professional valuer.
Mode 1 — Enterprise Value from EBITDA × Multiple
Enter annual EBITDA and the multiple used, then add debt and cash to get equity value.
EV = EBITDA × Multiple | Equity Value = EV − (Total Debt − Cash)
Note: results below are educational estimates, not professional investment advice. The multiple used should come from comparable transactions in the same industry.
Earnings before interest, taxes, depreciation, amortization.
Example: 8 means 8× EBITDA.
Valuation results
Enterprise Value (EV)–
Net debt–
Equity value–
Mode 2 — Reverse Solver
Choose the direction: find the implied multiple from a deal price, or find the unknown EBITDA/EV.
Solver results
Implied multiple–
Mode 3 — Comparator & Sensitivity Analysis
Compare two companies or two acquisition-target scenarios, then see how EV changes as the multiple moves up and down.
Comparison
Company A EV–
Company B EV–
EV difference (A − B)–
Implied multiple A–
Implied multiple B–
Sensitivity table — Company A EV at ±2 multiple
Multiple
Enterprise Value
Δ vs base
Mode 4 — Industry Multiple Reference Table
Average EV/EBITDA ratios per industry as a comparison starting point. Figures below are indicative, not real-time market prices.
Industry
EV/EBITDA
Number of companies
Software (systems & applications)
24.48×
309
Healthcare products
19.78×
204
Restaurants
17.49×
64
General retail
17.38×
23
Construction materials
16.82×
40
Machinery & manufacturing
16.22×
105
Business & consumer services
14.26×
155
Computer services
14.10×
64
Transportation
12.55×
19
Food processing
10.01×
78
Education
9.26×
32
Telecommunications (services)
6.54×
39
Auto parts
6.43×
35
Oil & gas (exploration & production)
5.15×
142
Market average (excluding financials)
16.95×
4,822
Source: Aswath Damodaran, NYU Stern School of Business — the "EV/EBITDA" table for companies with positive EBITDA, accessed 9 October 2026. Data covers 5,994 US-listed companies; figures are updated annually and may change. Actual multiples in Indonesia can differ substantially depending on company size, growth, and country risk — use only as a starting picture, not a price reference.
How to read the results & method limits
EBITDA multiple values a company from its cash operating profit. The core formula is simple: EV = EBITDA × multiple. A fair multiple comes from comparable transactions or the average of similar industries — see the reference table in Mode 4 as a starting point, not a final number.
Note its limits: this method ignores capital expenditure (capex) and working capital changes, so two companies with the same EBITDA can have very different free cash flow. The method is also meaningless when EBITDA is zero or negative.
⚠️ Educational estimate, not investment advice. This calculator’s results do not account for management quality, legal risk, industry prospects, and dozens of other factors affecting a company’s fair price. For real transactions, use a certified independent valuer and perform due diligence.
Frequently Asked Questions (FAQ)
What is an EBITDA multiple?
An EBITDA multiple is a valuation ratio comparing a company’s enterprise value (EV) to its EBITDA, formulated as EV divided by EBITDA. An 8× multiple means the market values the company at eight times its annual cash operating profit. This ratio is popular because it enables valuation comparisons across companies with different capital structures.
What is enterprise value (EV)?
Enterprise value is the total value of a company to all capital providers, computed as equity value plus net debt (total debt minus cash). EV reflects the price that must be paid to take over the entire company, including taking over its debt.
The P/E ratio compares share price to net income per share, so it only reflects the shareholder perspective and is affected by debt structure. EV/EBITDA uses enterprise value and earnings before interest, taxes, depreciation, and amortization, so it is more neutral toward capital structure and suitable for comparing companies with different debt levels.
How do you value a company with an EBITDA multiple?
Two steps. First, compute enterprise value with the formula EV equals EBITDA times the multiple. Second, compute equity value with the formula equity value equals EV minus net debt, where net debt is total debt minus cash and cash equivalents.
When is the EBITDA multiple not suitable?
This method is unsuitable when a company’s EBITDA is zero or negative because the result is meaningless, when earnings fluctuate greatly year to year, or when the company operates in an industry whose valuation conventionally uses another metric — such as banks and insurers, which use price to book value. Always compare with similar companies in the same industry.
What is net debt?
Net debt is total interest-bearing debt minus cash and cash equivalents. When cash exceeds debt, the company is in a net cash position, so its equity value is actually larger than its enterprise value. This concept matters because a buyer of the company takes over the debt while also getting its cash.
Does a high multiple always mean a good company?
No. A high multiple can mean the market expects high earnings growth in the future, but it can also mean the company is overvalued. Conversely, a low multiple can mean a cheap valuation or reflect high business risk. A multiple is only meaningful when compared with the industry average and the company’s prospects.
Can this calculator’s results be used as a basis for buying or selling a company?
No. This calculator is educational and its results are rough estimates, not investment advice and not a professional valuation. Real company sale-and-purchase transactions require a certified independent valuer, due diligence on the financial statements, and consideration of factors one ratio cannot capture, such as management quality and legal risk.
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