EBITDA Margin

Returns the EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) margin for a company. This measures operating profitability as a percentage of revenue.

EBITDA Margin = EBITDA / Revenue

Interpretation

Range Interpretation
> 30% Excellent operational efficiency
20% - 30% Good profitability
10% - 20% Average profitability
< 10% Low profitability or capital-intensive

Why Use EBITDA Margin?

  • Removes effects of financing decisions (interest)
  • Removes effects of accounting decisions (depreciation)
  • Allows comparison across companies with different capital structures
  • Approximates operational cash flow generation

Examples

=ebitda_margins("AAPL")
Apple EBITDA margin
=ebitda_margins("MSFT")
Microsoft EBITDA margin
=ebitda_margins("AMZN")
Amazon EBITDA margin
=ebitda_margins(A1)
Symbol from cell reference
=ebitda_margins("AAPL")*100
Convert to percentage

When to Use

  • Comparing profitability across companies
  • Evaluating operational efficiency
  • Screening for profitable companies
  • Valuation analysis (EV/EBITDA multiple)
  • Assessing cash generation capability

When NOT to Use

Scenario Use Instead
Need net income profitability profit_margin()
Need gross profitability gross_margin()
Need operating income margin operating_margin()
Historical EBITDA data hf_EBITDA()

Common Issues & FAQ

Q: Why is the margin returned as a decimal? A: The value is returned as a decimal (e.g., 0.25 for 25%). Multiply by 100 for percentage: =ebitda_margins("AAPL")*100

Q: Why might EBITDA margin be misleading? A: EBITDA ignores:

  • Capital expenditure requirements
  • Working capital changes
  • Actual cash flow timing
  • Tax implications

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