Benchmarks: EV/Revenue

EV/Revenue: Calculated by dividing Enterprise Value by Revenue is often used to benchmark the fair market value of a company. It's key benefit over the other enterprise value multiples like EV/EBITDA and EV/EBIT or equity multiples like P/E ratio is that it can be used for companies that have negative earnings.

Companies with higher profit margins usually trade at higher EV/Revenue multiples.