Earnings before interest and taxes (EBIT) is a measure of a firm's profit that includes all expenses except interest payments and income tax. EBIT is used in different ratios such as the Earnings Yield, the Greenblatt Magic Formula and the Altman Z-Score. Greenblatt uses EBIT instead of reported earnings because this allowed him to compare different companies without the distortions arising from differences in tax rates and debt levels. EBIT is based on the latest 12-month period, as described in Greenblatt's little book.
The EBIT is converted to the currency selected in the Currency Filter in the Filter Menu. The prior day exchange rate is used to make the conversion. By converting to a common currency, we ensure that you can compare companies reporting in different countries.