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GNC EV/EBITDA

What is the EV/EBITDA of GNC?

The EV/EBITDA of GNC Holdings, Inc. is 7.14

What is the definition of EV/EBITDA?



EV/EBITDA is enterprise value divided by earnings before interest, tax, depreciation, and amortization. It is a measure of how expensive a stock is and is more frequently valid for comparisons across companies than the price to earnings ratio. It measures the price (in the form of enterprise value) an investor pays for the benefit of the company’s cash flow (in the form of EBITDA).

= enterprise value / EBITDA

Price to earnings ratios are impacted by a company's choice of capital structure - companies which raise money via debt will have lower P/Es (and therefore look cheaper) than companies that raise an equivalent amount of money by issuing shares, even though the two companies might have equivalent enterprise values. A sample case is when a company with debt were to raise money by issuing shares of stock, and then used the money to pay off the debt, this company's P/E ratio would shoot up because of the increased number of shares - although nothing about the fundamental value of the business has changed. EV / EBITDA is unaffected by capital structure as enterprise value includes the value of debt, and EBITDA is available to all investors (debt and equity) as it excludes interest payments on that debt. It is ideal for analysts and potential investors looking to compare companies within the same industry.

EV/EBITDA of companies in the Health Care sector on OTC compared to GNC

What does GNC do?

GNC Holdings, Inc., together with its subsidiaries, operates as a specialty retailer of health, wellness, and performance products. It operates in three segments: U.S. and Canada, International, and Manufacturing/Wholesale. The company's products include protein, performance supplements, weight management supplements, vitamins, herbs and greens, wellness supplements, health and beauty products, food and drink products, and other general merchandise. It also provides third-party contract manufacturing services. The company sells its products through company-owned retail stores and its GNC.com Website, e-commerce and wholesale partnerships, and domestic and international franchise activities under the GNC proprietary brands, as well as other third-party brands. As of December 31, 2019, it had 7,532 GNC store locations worldwide. The company has a strategic partnership with Harbin Pharmaceutical Group Holding Co., Ltd. and International Vitamin Corporation. GNC Holdings, Inc. was founded in 1935 and is headquartered in Pittsburgh, Pennsylvania. On June 23, 2020, GNC Holdings, Inc., along with its affiliates, filed a voluntary petition for reorganization under Chapter 11 in the US Bankruptcy Court for the District of Delaware.

Companies with ev/ebitda similar to GNC