Enterprise Value multiples (X)

Enterprise value multiples are unlevered metrics with objective of Firm valuation. Are largely used in Finance for benchmarking analysis and they represent the true takeover value of the Firm. They are valuable in estimating also the economic value of the target  company, especially during M&A operations.

Used for a quick overview about a company value.

• ➡ EV/SALES Measures the total firm value relative to revenues
• ➡ EV/EBIT Measures value relative to operating profit after depreciation but before interest and tax
• ➡ EV/EBITDA Measures firm value relative to operating profitability before interests,tax, depreciations and amortizations

Used as unlevered multiple

• 👉 These multiples use Enterprise Value (EV)
• 👉 They are independent of capital structure
• 👉 They measure value attributable to all capital providers (Debt + Equity)