EBT to EBIT
Calculate the EBT to EBIT ratio, which shows how much of a company’s earnings before interest and taxes (EBIT) is left after interest expense.
A ratio close to 1 means interest takes little of the operating profit; a lower ratio means a heavier interest load. Taxes play no part in the ratio. Unlike get_interest_burden_ratio, which uses the reported income before tax and operating income, both figures here are rebuilt from net income, income tax expense and interest expense.
The formula is as follows:
\[\text{EBT to EBIT} = (\text{Net Income} + \text{Income Tax Expense}) / (\text{Net Income} + \text{Income Tax Expense} + \text{Interest Expense})\]Also known as: EBT to EBIT, interest burden.
EBT to EBIT in Python or via the MCP
Install the Finance Toolkit with:
pip install financetoolkit -U
Then call get_EBT_to_EBIT as shown below.
from financetoolkit import Toolkit
toolkit = Toolkit(
["HLT", "MAR", "CHH"],
api_key="FINANCIAL_MODELING_PREP_KEY",
start_date="2021-01-01",
end_date="2025-12-31",
)
toolkit.ratios.get_EBT_to_EBIT()
Or, after setting up the Finance Toolkit MCP, ask:
How much of their earnings before interest and taxes did Hilton, Marriott and Choice Hotels keep after interest expense from 2021 to 2025?
Which returns:
| 2021 | 2022 | 2023 | 2024 | 2025 | |
|---|---|---|---|---|---|
| CHH | 0.8894 | 0.9085 | 0.8403 | 0.819 | 0.8331 |
| HLT | 0.5865 | 0.8067 | 0.7838 | 0.7577 | 0.7697 |
| MAR | 0.7375 | 0.8854 | 0.8567 | 0.8193 | 0.8075 |
Parameters
get_EBT_to_EBIT accepts the following parameters.
| Parameter | Type | Description | Example |
|---|---|---|---|
rounding | int | None | The number of decimals to round the results to. Defaults to None, which uses the rounding of the Toolkit (4 unless set otherwise). | 2 |
growth | bool | Whether to calculate the growth of the ratios. Defaults to False. | True |
lag | int | list[int] | The lag to use for the growth calculation. Defaults to 1. | 4 |
compound | bool | Whether the growth is the compound annual growth rate over the lag (e.g. lag=5 for the five-year CAGR) instead of the total change. Defaults to False. | False |
standardize | bool | Whether to standardize (Z-Score) the result. When combined with growth=True, standardizes the growth values instead of the raw values. Defaults to False. | True |
trailing | int | The number of periods to sum flows (income and cash flow statement items) over, with balance sheet items averaged over the same number of period ends. E.g. 4 with quarterly data gives the trailing twelve months (TTM) and 3 with annual data a three-year cumulative figure. Defaults to None, which uses single-period flows (per quarter and not annualized with quarterly data). | 4 |