Metrics and modeling: EV/EBITDA, ROIC, cohorts, unit economics
Four measures that separate durable businesses from leaky buckets, and how to read each one.
EV/EBITDA triangulates enterprise value to pre-tax operating cash flow; because EBITDA excludes interest on excess cash, cash is netted from EV to avoid overstating the multiple.
ROIC (NOPAT over invested capital) frames whether growth creates value. Sustained ROIC above WACC compounds intrinsic value; below it, growth destroys value.
For go-to-market, unit economics (LTV, CAC, payback) and cohort analysis (retention and expansion by vintage or segment) separate durable models from leaky buckets. A higher LTV:CAC (often ~3x as a rough bar) and improving cohort retention are the tells.
Informational content only. Not investment advice.