What is a stock's price-to-EBITDA ratio?

@matteo.zboncak 

A stock's price-to-EBITDA ratio is a valuation metric that compares the market price of a stock to its earnings before interest, taxes, depreciation, and amortization (EBITDA). It is calculated by dividing the stock's market price per share by its EBITDA per share.

EBITDA is a measure of a company's profitability and represents its earnings before accounting for interest expenses, tax payments, and non-cash depreciation and amortization expenses.

The price-to-EBITDA ratio is commonly used by investors to assess whether a stock is overvalued or undervalued compared to its earnings. A lower ratio indicates that the stock may be undervalued, while a higher ratio can suggest overvaluation. However, this ratio should not be considered in isolation and should be used in conjunction with other valuation measures and fundamental analysis to make investment decisions.