Four Decades Of Data Show EBITDA Is The Best Valuation Metric

Rupert Hargreaves

Published onJuly 18, 2017

Updated on May 14, 2021

Mirror, mirror on the wall, which is the best valuation metric of them all?

I think that, every time you saw the word EBITDA [earnings], you should substitute the word “bullshit” earnings. – Charlie Munger

Charlie Munger famously isn’t a fan of EBITDA earnings, but if a new research paper from Columbia Business School is to be believed, investors should not be so quick in disregarding this financial metric.

[munger]

Published last month, the research paper evaluates and compares the informativeness of EBITDA, EBITA, and EBIT in the...

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Rupert Hargreaves

Sign up now and get our in-depth FREE e-books on famous investors like Klarman, Dalio, Schloss, Munger Rupert is a committed value investor and regularly writes and invests following the principles set out by Benjamin Graham. He is the editor and co-owner of Hidden Value Stocks, a quarterly investment newsletter aimed at institutional investors. Rupert owns shares in Berkshire Hathaway. Rupert holds qualifications from the Chartered Institute For Securities & Investment and the CFA Society of the UK. Rupert covers everything value investing for Hedge Fund Alpha

Four Decades Of Data Show EBITDA Is The Best Valuation Metric

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