Earnings before interest, taxes, depreciation, and amortization (EBITDA) is a ratio that indicates how much money is made and accessible to pay down debt before those costs are paid. Debt/EBITDA gauges a business's capacity to settle its accumulated debt. A high ratio result can suggest that a business has an excessive amount of debt. In the covenants for business loans, banks frequently set a specific debt/EBITDA target that a firm must maintain in order to avoid having the full loan fall due immediately. Credit rating agencies frequently use this statistic to determine a company's likelihood of defaulting on issued debt, and businesses with a high debt/EBITDA ratio may not be able to properly pay their debt, which could result in a decreased credit rating.
The market has been range bound for the last few weeks with volatility on the decline, and earnings all over the place. So where to go to look for a trade? Nike has already had Earnings and is near a low of the year, so seems like a good option. As a contrarian that can mean only one thing to me: I have to make a trade with the assumption it will go up from here over the next 45ish days. We will do that by making a Long Call Vertical trade to bet that it starts to head up over the next couple months. For more on my trading and how to join me in real time, see below. Watch the video to get the details. Kal Trading Risk Disclaimer All the information shared in this video is provided for educational purposes only. Any trades placed upon reliance of SharperTrades.com are taken at your own risk for your own account. Past performance is no guarantee. While there is great potential for reward trading stocks, commodities, options and forex, there is also substantial risk of loss. All tr