ARMNEUTRAL

ARM EV/EBITDA Analysis

136.7x

Higher than 91% of Technology sector peers

Updated 3638h ago·SEC filings & market data

Key Takeaway

Enterprise value to EBITDA (EV/EBITDA) measures how many times a company’s total value (debt and equity) exceeds its earnings before interest, taxes, depreciation, and amortization — a higher multiple means the market prices each dollar of earnings at a premium.

Sector Performance

91th percentile

ARM

136.7x

Sector Median

19.5x

Sector Avg

44.5x

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Deep Analysis

At 136.7x, Arm’s EV/EBITDA is over five times the sector median of 25.2x, placing it in the 84th percentile among technology peers, meaning it is more expensive than 84% of comparable companies. No year-over-year or quarter-over-quarter changes are available, so there is no trend to evaluate. The combination of an extremely high current multiple with no trend data suggests the stock carries elevated valuation risk — investors are paying a very high price for each unit of EBITDA, with no historical context to confirm whether that premium is growing or shrinking. This metric does not support the overall NEUTRAL verdict; the extreme premium relative to peers implies bearish risk that would typically call for a more cautious rating, not a neutral stance.

Frequently Asked Questions

What does the EV/EBITDA tell investors about ARM?

A valuation multiple preferred by analysts for capital-intensive or leveraged businesses. Useful for cross-sector comparisons where earnings can be distorted by debt.

How is the EV/EBITDA calculated?

EV/EBITDA is calculated as: Enterprise Value / EBITDA.

How does ARM's EV/EBITDA compare to its sector?

ARM's EV/EBITDA of 136.7x compares to a Technology sector median of 19.5x, placing it in the 91th percentile.

Who are ARM's closest peers by EV/EBITDA?

The closest Technology peers by EV/EBITDA include: MSFT (19.8x), AMAT (19.3x), CRM (18.9x), SQ (18.2x), ZI (15.7x).

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Learn More About EV/EBITDA

EV/EBITDA Explained: The Valuation Metric Pro Investors Actually Use

Learn what EV/EBITDA is, why it beats P/E for capital-heavy companies, typical sector ranges, and key limitations every serious investor should know.

The Formula

Enterprise Value / EBITDA

Why It Matters

A valuation multiple preferred by analysts for capital-intensive or leveraged businesses. Useful for cross-sector comparisons where earnings can be distorted by debt.