EBITDA became a common tool for corporate valuation in the 80s, when US leveraged buyout firms used Michael Milken's junk bonds and PIK debt (deferred interest) to buy high cash flow companies, strip their non-core assets, skimp on maintenance capex, invest zero growth capex, tax-deduct enormous interest payments to reduce cash tax payments to zero, then flip the business to an unsuspecting strategic buyer or IPO it...it is completely useless as a measure of true valuation. NPAT is most closely related to true value.. obviously there are timing differences and odds and ends to adjust for...i'll wipe your dirt off my shoulder and respectfully ask that you and other armchair analysts that sell newsagents and lawn mowing franchises on multiples of EBITDA read a few more books and articles on corporate valuation
