|
EBITEBIT stands for "Earnings before Interest and Taxes" (operating income). A professional investor contemplating a change to the capital structure of a firm (e.g., through a leveraged buyout) first evaluates a firm's fundamental earnings potential (reflected by EBITDA and EBIT), and then determines the optimal use of debt vs. equity. To calculate EBIT, basic expenses (e.g., the cost of goods sold, selling and administrative expenses) are subtracted from revenues. Profit is later obtained by subtracting interest and taxes from the result. SourceSee Wikipedia See alsoExternal linksCreator
This page was created on Feb 15, 2006 |
|
|
|
|
|
