Gross Debt to EBITDA Ratio
Calculates the gross debt to EBITDA ratio, which measures the total (gross) debt of the company relative to its EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization).
This differs from the Net-Debt to EBITDA Ratio in that it uses total (gross) debt rather than net debt (total debt minus cash and cash equivalents). Gross debt to EBITDA is a more conservative leverage measure since it does not assume that a company’s cash balance would actually be used to pay down debt, which matters when comparing companies with restricted cash, cash earmarked for other purposes, or when assessing gross refinancing risk rather than net economic leverage.
The formula is as follows:
\[\text{Gross Debt to EBITDA Ratio} = \text{Total Debt} / \text{EBITDA}\]Gross Debt to EBITDA Ratio in Python or via the MCP
Install the Finance Toolkit with:
pip install financetoolkit -U
Then call get_gross_debt_to_ebitda_ratio as shown below.
from financetoolkit import Toolkit
toolkit = Toolkit(
["ORCL", "IBM", "AVGO"],
api_key="FINANCIAL_MODELING_PREP_KEY",
start_date="2021-01-01",
end_date="2025-12-31",
)
toolkit.ratios.get_gross_debt_to_ebitda_ratio()
Or, after setting up the Finance Toolkit MCP, ask:
How did the total debt of Oracle, IBM and Broadcom compare with their EBITDA from 2021 to 2025?
Which returns:
| 2021 | 2022 | 2023 | 2024 | 2025 | |
|---|---|---|---|---|---|
| AVGO | 2.766 | 2.0812 | 1.9782 | 2.8785 | 1.9013 |
| IBM | 4.1515 | 4.1625 | 4.2157 | 3.9615 | 3.8345 |
| ORCL | 5.4 | 4.7123 | 4.3955 | 4.3646 | 5.1938 |
Parameters
get_gross_debt_to_ebitda_ratio 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 |