EBITDA – “I think that, every time you see the word EBITDA, you should substitute the word ‘bullshit earnings.’ ” – EBITDA stands for “earnings before interest, taxes, depreciation, and amortization.” Charlie considers interest, depreciation, and taxes to be very real expenses that have to be paid. Interest and taxes have to be paid in the current year. Depreciation is a cost that has to be paid at a later date—for example, when a plant and equipment eventually need replacing. That eventual replacement is a capital cost. And capital costs can destroy what otherwise appears to be a really great
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