leverage ratio

leverage ratio
USA
leverage ratio, Also known as the debt/EBITDA ratio.
The ratio of debt (borrowings) to EBITDA, often expressed as a percentage or ratio. It is often used as a measure of the risk attached to a company because a highly leveraged company has a large interest burden which has to be met whether or not profits are made.

Practical Law Dictionary. Glossary of UK, US and international legal terms. . 2010.

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  • Leverage Ratio — 1. Any ratio used to calculate the financial leverage of a company to get an idea of the company s methods of financing or to measure its ability to meet financial obligations. There are several different ratios, but the main factors looked at… …   Investment dictionary

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  • leverage — le·ver·age 1 / le vrij, və rij/ n: the use of credit to enhance one s speculative capacity leverage 2 vt aged, ag·ing: to provide (as a corporation) or supplement (as money) with leverage Merriam Webster’s Dictionary of Law. Merriam Webster. 1996 …   Law dictionary

  • target leverage ratio — The ratio of the market value of debt to the total market value of the firm that management seeks to maintain. Bloomberg Financial Dictionary …   Financial and business terms

  • leverage — The ability to control large dollar amounts of a commodity with a comparatively small amount of capital. Chicago Board of Trade glossary The control of a larger sum of money with a smaller amount. By accepting the liability to purchase or deliver …   Financial and business terms

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  • Leverage — The use of debt financing. The New York Times Financial Glossary * * * ▪ I. leverage le‧ver‧age 1 [ˈliːvrɪdʒ ǁ ˈle , ˈliː ] noun [uncountable] 1. the influence that one person or organization has on another: • It uses its considerable economic… …   Financial and business terms

  • leverage rebalancing — Making transactions to adjust (rebalance) a firm s leverage ratio to a target ratio. Bloomberg Financial Dictionary …   Financial and business terms

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