Operating_income Operating_income

Operating income - Definition

Related Words: Active, Behavioral, Functional, Performing, Running, Working

EBIT stands for "Earnings before Interest and Taxes" (operating income). A professional investor contemplating a change to the capital structure of a firm (e.g., through a leveraged buyout) first evaluates a firm's fundamental earnings potential (reflected by EBITDA or EBIT), and then determines the optimal use of debt vs. equity.

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