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EBITDA

Earnings before interest, taxes, depreciation and amortization is useful for comparing the income of companies with different capital structures. Companies with significant fixed assets, such as manufacturing companies, or companies which incur large depreciation charges or companies which have significant intangible assets which result in large amortization charges can easily be compared. It is also a useful measure for a company's creditors as it is shows the income available for interest payments.

See also: Cash Flow, Free Cash Flow, EBIT, Operating Cash Flow

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