Why might measures based on EBIT (earnings before interest and taxes) or EBITDA be more...

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Finance

Why might measures based on EBIT (earnings before interest and taxes) or EBITDA be more useful than the price/earnings (P/E) ratio as bases for valuing companies (i.e. stock market capitalisation/earnings, or total enterprise value/EBIT)? What might be the disadvantages of using EBIT or EBITDA?

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