EBITDA Multiples by Industry (2025)

Last Updated: December, 2025

Company valuation is one thing that every entrepreneur must bear in mind at every stage of a business. No significant decision can be taken without estimating the market value of a company at any given point. Factors called valuation multiples are important indicators in this process. Investors and company managements alike use these valuation multiples by industry as a guide in funding and budgeting decisions. EBITDA multiples by industries are a subset of a wider group of these financial tools known as the valuation multiples.

EBITDA Multiples for Various Industries

‘Multiple’ as such means a factor of one value to another. In the context of company valuation, valuation multiples represent one finance metric as a ratio of another. These multiples are widely categorized into three types – equity multiples, enterprise value multiples, and revenue multiples. This article focuses on EBITDA multiples valuation which is a type of enterprise value multiple.

What is EBITDA Multiple?

EBITDA stands for Earnings Before Interest Taxes Depreciation and Amortization. EBITDA multiples are a ratio of the Enterprise Value of a company to its EBITDA. These multiples are very useful to estimate the market value of a company based on a set of standard factors and simultaneously compare them to other companies in the industry with similar credentials. They are especially beneficial to compare companies within the industry but vary in aspects such as their capital structure, asset ownership, taxation, etc.

Usually in the initial stages of a business, revenue multiples are used. As the company begins to mature and profit potential becomes a determining factor for investors and market valuation, EBITDA multiples by industry are used to understand the profit potential of a company. A higher value indicates a higher profit possibility and vice versa. However, as a good practice, these multiples are not used as a single point of reference. Experienced analysts always refer to the value from two or more valuation multiples to arrive at a realistic valuation of a business.

Why is the EBITDA Multiple important?

To understand the importance of EBITDA multiples, one must begin by questioning the relevance of the two factors used in the calculation – the EV (enterprise value) and the EBITDA of the company. Enterprise value estimates the total worth of a company in the market, while EBITDA measures the profit potential of the same business. When these two are calculated as a factor of one to another, the resulting multiple provides a realistic estimate of the true merit of the company as an investment option. Investors can compare the multiples of various companies and estimate how much they really need to pay to acquire this company.

As a practice, it is seen that the lower the value of the EBITDA multiplies by industry, the cheaper is the acquisition cost of the company. Usually, any value below 10 is considered good. Thus with an EBITDA multiple, investors planning on the acquisition can estimate the following:

• Company A is trading for example at 5x
• Company B, C, D, and E are trading at 7x, 6.5x, 3x, and 9x respectively
• Company D with an EBITDA multiple of 3x seems to be the best choice for acquisition

Investors find EBITDA multiples valuation reliable while considering companies within the same industry for mergers and acquisitions. However, it is important to know that investors will always try to pitch for a lower valuation and make the necessary adjustments to the EBITDA multiple while a seller will try the opposite. An expert analyst should always keep a lookout for wrong estimations arising from these factors.

EBITDA Multiple formula 

As discussed, EBITDA multiple by industry is derived from two financial metrics – the enterprise value and the EBITDA of a company. The formula looks like this:

Let’s discuss each component one at a time.

What is EV?

EV or the Enterprise value is the first thing investors look at during mergers and acquisitions. As such, there are many factors beyond internal financial metrics that contribute to the true valuation of a company. However, funding decisions can’t be based on vague estimations. To ensure solidity in company valuations, enterprise value is used as a common reference. Though it is a theoretical value of takeover, private equity firms have evolved to rely heavily on this metric. Enterprise value indicates the amount of money needed to acquire a business.

Enterprise Value is calculated in two ways. The simplest one is:

And the elaborate version of this formula is:

Another variation of EV calculation could be:

As seen in the formula, enterprise value does not depend on the capital structure of a company. Thus, it can be safely used to compare companies with varying cap structures for a takeover. As a result, being part of the EBITDA multiple valuations, the enterprise value as an entity lends this character to the multiple as well. An EBITDA multiple is thus a reliable valuation tool while comparing companies with varying cap structures.

What is EBITDA?

Earnings Before Interest Taxes Depreciation and Amortization or EBITDA is used by investors to solely estimate a company’s profitability excluding the non-operating and non-controllable assets. This metric is easily derived from the financial reports maintained by a company. Analysts do not need to use complicated calculations to derive this value. It is simple and straightforward. EBITDA formula is as follows:

EBITDA points at the current financial health of a company. Based on this value, analysts estimate the future profit-making potential of the company. Thus, EBITDA as a part of EBITDA multiples by industry contributes as the metric that determines the profitability of companies being considered for a potential takeover.

Pros and Cons of EBITDA Multiple Valuation

EBITDA multiples valuation is a go-to technique for most investors and financial analysts dealing with high-profit mergers and acquisitions. Using this category of valuation multiple indeed has its merits; however, it is also important to note the loopholes as well. Here is a brief about the pros and cons of EBITDA multiples:

Pros of EBITDA multiples

• It can be used to evaluate various types of businesses, private as well as public. But using this multiple for public company valuations is the easiest as all financial information for such companies are readily available.
• They are best used to evaluate companies entering advanced stages of funding such as Series-B onwards. The profitability of a company is a crucial factor at this stage. The use of enterprise value as well as EBITDA together in a ratio provides investors sufficient clarity about the future profit potential of an expanding business.
• They have proven to be very useful to evaluate as well as compare companies of different sizes and capital structures. This flexibility allows a wide range of comparisons for investors to play within an industry.
• They help to evaluate companies faster in comparison to valuation multiples based on financial metrics that use cash flow and other income-generating sources.

Cons of EBITDA multiples

• They do not account for capital expenditures. Thus if a business has high capital spends, those do not feature in the multiple and might lead to skewed valuations.
• They do not consider exact cash flows as well. This again might not represent the actual financial situation of a company leading to wrong estimations.
• EBITDA multiples valuation is not regulated by any financial body. This leaves a wide berth for variations in calculations across industries. It is mostly left to the company valuation professionals and the investors involved in the takeover negotiations.
• Due to this non-regulatory aspect, it leaves open chances of misinterpretations.

EBITDA Multiples by Industry

Here is a compilation of EBITDA multiples across industries. To study this table, a couple of aspects are worth considering. Firstly, EBITDA multiples for small business or startups will be lower, in the range of 4x. Secondly, these multiples will be at a higher range for large, publicly traded companies. And lastly, since EBITDA multiples are not regulated by any federal body, fair play is expected as a good practice in business.

SECTOR	INDUSTRY	EV to EBITDA as of Dec 2025
Communication Services		13.09
	Advertising	10.79
	Alternative Carriers	10.84
	Broadcasting	8.841
	Cable & Satellite	6.077
	Integrated Telecommunication Services	6.393
	Interactive Home Entertainment	23.24
	Interactive Media & Services	21.34
	Movies & Entertainment	15.49
	Publishing	13.2
	Wireless Telecommunication Services	9.586
Consumer Discretionary		14.32
	Apparel Retail	17.09
	Apparel, Accessories & Luxury Goods	12.37
	Automobile Manufacturers	13.54
	Automotive Parts & Equipment	6.973
	Automotive Retail	15.86
	Broadline Retail	19.12
	Casinos & Gaming	12.23
	Computer & Electronics Retail	9.825
	Consumer Electronics	10.13
	Distributors	9.989
	Education Services	11.98
	Footwear	19.27
	Home Furnishings	11.34
	Home Improvement Retail	15.24
	Homebuilding	10.35
	Homefurnishing Retail	13.82
	Hotels, Resorts & Cruise Lines	13.68
	Household Appliances	9.154
	Housewares & Specialties	8.469
	Leisure Facilities	12.49
	Leisure Products	11.55
	Motorcycle Manufacturers	6.134
	Other Specialty Retail	13.16
	Restaurants	17.65
	Specialized Consumer Services	7.792
	Textiles	5.864
	Tires & Rubber	6.029
Consumer Staples		13.52
	Agricultural Products & Services	12.42
	Brewers	7.65
	Consumer Staples Merchandise Retail	20.5
	Distillers & Vintners	9.29
	Drug Retail	9.629
	Food Distributors	10.92
	Food Retail	9.324
	Household Products	13.56
	Packaged Foods & Meats	10.12
	Personal Care Products	14.18
	Soft Drinks & Non-alcoholic Beverages	16.81
	Tobacco	12.2
Energy		6.644
	Coal & Consumable Fuels	9.192
	Integrated Oil & Gas	5.456
	Oil & Gas Drilling	5.401
	Oil & Gas Equipment & Services	8.234
	Oil & Gas Exploration & Production	5.088
	Oil & Gas Refining & Marketing	8.431
	Oil & Gas Storage & Transportation	12.11
Financials		20.04
	Asset Management & Custody Banks	17.64
	Commercial & Residential Mortgage Finance	28.35
	Consumer Finance	10.93
	Diversified Banks	-
	Diversified Capital Markets	-2.415
	Diversified Financial Services	10.55
	Financial Exchanges & Data	19.85
	Insurance Brokers	16.59
	Investment Banking & Brokerage	14.12
	Life & Health Insurance	-
	Mortgage REITs	10.66
	Multi-line Insurance	-
	Multi-Sector Holdings	16.07
	Property & Casualty Insurance	74.35
	Regional Banks	-
	Reinsurance	-
	Specialized Finance	15.75
	Transaction & Payment Processing Services	17.53
Health Care		14.57
	Biotechnology	16.17
	Health Care Distributors	14.12
	Health Care Equipment	19.9
	Health Care Facilities	10.22
	Health Care Services	10.83
	Health Care Supplies	15.88
	Health Care Technology	23.43
	Life Sciences Tools & Services	21.13
	Managed Health Care	19
	Pharmaceuticals	12.63
Industrials		14.01
	Aerospace & Defense	22.61
	Agricultural & Farm Machinery	12.88
	Air Freight & Logistics	9.68
	Airport Services	11.24
	Building Products	12.69
	Cargo Ground Transportation	10.62
	Commercial Printing	9.473
	Construction & Engineering	13.71
	Construction Machinery & Heavy Transportation Equipment	14.09
	Data Processing & Outsourced Services	11.77
	Diversified Support Services	16.73
	Electrical Components & Equipment	18.22
	Environmental & Facilities Services	15.28
	Heavy Electrical Equipment	28.59
	Highways & Railtracks	12.27
	Human Resource & Employment Services	14.64
	Industrial Conglomerates	13.49
	Industrial Machinery & Supplies & Components	15.34
	Marine Ports & Services	9.302
	Marine Transportation	6.432
	Office Services & Supplies	9.169
	Passenger Airlines	7.121
	Passenger Ground Transportation	17.23
	Rail Transportation	12.26
	Research & Consulting Services	15.09
	Security & Alarm Services	8.438
	Trading Companies & Distributors	14.13
Information Technology		24.33
	Application Software	26.7
	Communications Equipment	21.97
	Electronic Components	17.62
	Electronic Equipment & Instruments	17.67
	Electronic Manufacturing Services	14.75
	Internet Services & Infrastructure	48.21
	IT Consulting & Other Services	14.85
	Semiconductor Materials & Equipment	26.21
	Semiconductors	30.65
	Systems Software	21.83
	Technology Distributors	10.2
	Technology Hardware, Storage & Peripherals	21.68
Materials		10.26
	Aluminum	7.852
	Commodity Chemicals	8.726
	Construction Materials	11.97
	Copper	11.29
	Diversified Chemicals	7.583
	Diversified Metals & Mining	9.609
	Fertilizers & Agricultural Chemicals	7.118
	Forest Products	16.76
	Gold	11.06
	Industrial Gases	15.04
	Metal, Glass & Plastic Containers	8.597
	Paper & Plastic Packaging Products & Materials	9.756
	Paper Products	9.276
	Precious Metals & Minerals	8.788
	Silver	17.68
	Specialty Chemicals	12.63
	Steel	8.29
Real Estate		18.67
	Data Center REITs	30.88
	Diversified Real Estate Activities	13.69
	Diversified REITs	15.61
	Health Care REITs	23.96
	Hotel & Resort REITs	12.04
	Industrial REITs	21.58
	Multi-Family Residential REITs	17.33
	Office REITs	15.7
	Other Specialized REITs	15
	Real Estate Development	12.22
	Real Estate Operating Companies	21.99
	Real Estate Services	25.18
	Retail REITs	17.21
	Self-Storage REITs	18.24
	Single-Family Residential REITs	18.06
	Telecom Tower REITs	19.91
	Timber REITs	16.14
Utilities		10.86
	Electric Utilities	10.1
	Gas Utilities	10.33
	Independent Power Producers & Energy Traders	11.52
	Multi-Utilities	12.07
	Renewable Electricity	15.8
	Water Utilities	11.65

Data Source: ycharts.com, data for the United States on December 16, 2025

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