EBITDA is a metric that's meaningful if you owned the whole business from the prospective of a larger company swallowing a smaller. For example, EBITDA says, "o

EBITDA is a metric that's meaningful if you owned the whole business from the prospective of a larger company swallowing a smaller. For example, EBITDA says, "ok, if I were to price this whole business, and my cost of capital didn't change, I can use this metric to compare it to rewards of ownership of another." It allows you to "divide out" the accounting details of a business. (eg, I can borrow cheaper, or, I can use economies of scale to decrease some amortization cost, etc.) It is largely bogus when discussing the overall metrics of a business, or using it in isolation.