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First EBITDA now ‘Underlying Adjusted EBITDA’ - are you getting fed up with adjustments?

22/05/2017

First EBITDA now ‘Underlying Adjusted EBITDA’ - are you getting fed up with adjustments?
Analysts’ obsession with quoting the fanciful ‘EBITDA’ as a valuation metric is now extending to the even more ridiculous ‘Underlying Adjusted EBITDA’, which must represent the most meaningless measure in the history of financial analysis. Why not just focus on cash?

We are certainly getting fed up with the myriad of adjustments in financial statements and the obsession of quoting EBITDA or Adjusted EBITDA. From our perspective, this is simply another way of being told that ‘results were awful and these are our excuses’.

For the uninitiated, a brief reminder that EBITDA is an abbreviation of the term ‘Earnings Before Interest, Tax, Depreciation and Amortization’. A measure some analysts seem to assume gives a good…

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