Net debt / EBITDA: what it is and how to read it
It tells you how many years the company would need to pay off its net debt from what its business generates, if it used all of its EBITDA for that. It is the leverage measure banks and rating agencies look at most.
How it is calculated
Net debt / EBITDA = (financial debt − cash) / annual EBITDA.
How to read it
Below 2, debt is usually comfortable; between 2 and 3, reasonable; above 4, high for most sectors. If it is negative, the company has more cash than debt.
Net debt / EBITDA in the MeridIAn ranking
Among the 1,636 companies in the ranking with data, the median Net debt / EBITDA is 1.60: half are below and half above. The lowest 25% are below 0.20 and the highest 25% above 3.12.
For example: NVIDIA, −0.12; Apple, 0.13; Alphabet, −0.70; Inditex, −0.43.
By sector
| Sector | Median | Companies with data |
|---|---|---|
| Basic Materials | 1.41 | 140 |
| Communication Services | 2.19 | 98 |
| Consumer Cyclical | 1.92 | 222 |
| Consumer Defensive | 2.38 | 124 |
| Energy | 1.25 | 96 |
| Healthcare | 1.54 | 213 |
| Industrials | 1.58 | 384 |
| Technology | 0.23 | 267 |
| Utilities | 5.33 | 92 |
Lowest Net debt / EBITDA
What to watch out for
Utilities, toll roads or telecoms can carry higher ratios because their revenue is very stable. It is not used for banks or insurers.
Related metrics
All metrics in the glossary → · Stocks by sector and country → · Ready-made screeners →
General information for educational purposes, not investment advice. Figures from the latest weekly analysis (Oct 8, 2026) with the latest available price.