what are the disadvantages of ebitda margin 
the ebitda margin excludes debt in its calculation of a company s performance some companies highlight their ebitda margins as a way to draw attention away from their debt and enhance the perception of their financial performance the ebitda margin is usually higher than profit margin which encourages companies with low profitability to feature it when emphasizing their success also ebitda isn t regulated by gaap the bottom lineebitda stands for earnings before interest taxes depreciation and amortization the ebitda margin is a measure of a company s operating profit as a percentage of its revenue ebitda margin is calculated by dividing ebitda by total revenue ebitda margin lets investors and financial analysts easily compare the profitability of multiple companies in the same sector or industry however it isn t the best measurement for all businesses ebitda doesn t take debt into account which can give a misleading picture of the financial position of high debt companies it can also be used to disguise a low profit margin because of these limitations ebitda should be just one of several metrics that investors use to analyze the performance of a business 