BABANEUTRAL

BABA EV/EBITDA Analysis

2.8x

Updated 205h ago·SEC filings & market data

Key Takeaway

EV/EBITDA (enterprise value divided by earnings before interest, taxes, depreciation, and amortization) measures how many years of EBITDA it would take to buy the entire company.

Sector Performance

10th percentile

BABA

2.8x

Sector Median

13.8x

Sector Avg

15.7x

Prior Period

2.3x(Jul 2026)

↓ Declining

📊

Deep Analysis

EV/EBITDA (enterprise value divided by earnings before interest, taxes, depreciation, and amortization) measures how many years of EBITDA it would take to buy the entire company.

BABA's current 2.8x ratio is far below the sector median of 13.6x, placing it in the 10th percentile among peers. The metric has been decreasing over the last eight quarters, with a year-over-year drop of 98.1% but a quarter-over-quarter increase of 20.3%. An extremely low EV/EBITDA combined with a recent uptick suggests the stock may be undervalued relative to earnings, but the deep prior decline signals ongoing volatility. This mixed picture—cheap valuation yet a still-declining longer-term trend—points to uncertain risk-reward balance. The metric broadly supports the overall NEUTRAL verdict, as it highlights both a potential value opportunity and the lingering effects of past compression.

Frequently Asked Questions

What does the EV/EBITDA tell investors about BABA?

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.

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

The closest peers by EV/EBITDA include: EDIT (-2.2x), NIO (-36.8x), SNAP (-38.8x), RBLX (-39.0x), LI (-47.0x).

📚

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.