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XeroASX:XRO +1.19%75 EV-to-EBIT is 27.98 as of Jul. 16, 2026, which is 4% below its 10-year median of 29.17. GuruFocus rates ASX:XRO with a GF Score™ of 75/100 and a GF Value™ of A$198.94 (Possible Value Trap). The stock has 7 warning signs investors should review. Among 1,762 Software companies, Xero ranks worse than 71.74% on this metric.
EV-to-EBIT is calculated as Enterprise Value divided by its EBIT. As of today, Xero's Enterprise Value is A$11,804 Mil.
Xero's EBIT for the trailing twelve months (TTM) ended in Mar. 2026 was A$422 Mil. Therefore, Xero's EV-to-EBIT for today is 27.98.
The historical rank and industry rank for Xero's EV-to-EBIT or its related term are showing as below:
ASX:XRO'
s EV-to-EBIT Range Over the Past 10 Years
Min: -2251.07 Med: 29.17 Max: 545.46
Current: 27.98
During the past 13 years, the highest EV-to-EBIT of Xero was 545.46. The lowest was -2251.07. And the median was 29.17.
ASX:XRO's EV-to-EBIT is ranked worse than 71.74% of 1762
companies
in the Software industry
Industry Median: 14.355
vs ASX:XRO: 27.98
This is a more accurate valuation of companies' operation because it considers the debt and cash on its balance sheet, and non-operating items such as interest payment, tax, and one-time items are not included in the Operating Income.
Xero's Enterprise Value for the quarter that ended in Mar. 2026 was A$12,972 Mil.
For company reported semi-annually, GuruFocus uses latest annual data as the TTM data. Xero's EBIT for the trailing twelve months (TTM) ended in Mar. 2026 was A$422 Mil.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Xero EV-to-EBIT Related Terms
Xero EV-to-EBIT Historical Data
* Premium members only.
The historical data trend for Xero's EV-to-EBIT can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
For the Software - Application subindustry, Xero's EV-to-EBIT, along with its competitors' market caps and EV-to-EBIT data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Xero EV-to-EBIT vs Software Industry
For the Software industry and Technology sector, Xero's EV-to-EBIT distribution charts can be found below:
* The bar in red indicates where Xero's EV-to-EBIT falls into.
Xero's current Enterprise Value is A$11,804 Mil.
For company reported semi-annually, GuruFocus uses latest annual data as the TTM data. Xero's EBIT for the trailing twelve months (TTM) ended in Mar. 2026 was A$422 Mil.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Xero (ASX:XRO) has a EV-to-EBIT of 27.98 as of Jul. 16, 2026. EV to EBIT ratio is the inverse of Joel Greenblatt's earnings yield definition. View historical data on Xero and its competitors. This is near median its historical median of 29.17. According to the industry distribution chart, Xero ranks #1264 out of 1762 companies in the Software industry, placing it in the top 71.7%.
Is Xero's EV-to-EBIT too high?
Xero's current EV-to-EBIT of 27.98 is near median its 10-year median of 29.17. The Software industry median EV-to-EBIT is 14.36. Xero's value of 27.98 is 94.9% above this industry median. Based on the distribution chart, Xero ranks #1264 out of 1762 companies in the Software industry, which is below the industry midpoint. Overall, Xero has a GF Score™ of 75/100 and is considered Possible Value Trap, reflecting its overall financial health beyond just this single metric.
How does Xero's EV-to-EBIT compare to UBER and SHOP?
According to the Software industry distribution chart, Xero ranks #1264 out of 1762 companies for EV-to-EBIT. This places Xero in the lower half of its industry. The industry median EV-to-EBIT is 14.36. Xero's value of 27.98 is 94.9% above this benchmark. While the company's 10-year median is 29.17 vs. the industry median of 14.36, Xero has consistently been above the industry average. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good EV-to-EBIT for a Software company?
The median EV-to-EBIT among Software companies is 14.36, based on 1,762 companies in the industry. Companies in the top quartile (top 25%) have a EV-to-EBIT significantly above this median, while those in the bottom quartile fall well below. However, EV-to-EBIT should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Xero's current EV-to-EBIT of 27.98 is 94.9% above the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high EV-to-EBIT mean?
A high EV-to-EBIT can signal that a stock is expensive relative to its fundamentals. EV to EBIT ratio is the inverse of Joel Greenblatt's earnings yield definition. View historical data on Xero and its competitors. For the Software industry, the median EV-to-EBIT is 14.36 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Xero's current EV-to-EBIT is 27.98, which is near median its own 10-year median of 29.17. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Xero stock overvalued right now?
Based on GuruFocus' analysis, Xero (ASX:XRO) is currently considered Possible Value Trap. The stock's GF Value™ is A$198.94, compared to a current price of A$69.08 — trading 65.3% below its estimated fair value. The current EV-to-EBIT is 27.98, which is near median its 10-year median of 29.17 and 94.9% above the Software industry median of 14.36. Xero's overall GF Score™ is 75/100 with 7 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is EV-to-EBIT calculated?
EV-to-EBIT is calculated from a company's financial statements. For Xero (ASX:XRO), the current EV-to-EBIT is 27.98 as of Jul. 16, 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Xero (ASX:XRO) Overvalued in 2026?
Based on GuruFocus' analysis, Xero stock appears to be undervalued.
The current stock price of A$69.08 is trading 65.3% below its estimated GF Value™ of A$198.94.
GuruFocus considers Xero to be Possible Value Trap.
Key valuation signals for ASX:XRO:
EV-to-EBIT: 27.98 (near median its 10-year median of 29.17)
GF Value™: A$198.94 vs. price of A$69.08 (65.3% below fair value)
Industry Position: 94.9% above the Software median (#1264 of 1762)
No single metric tells the full story. See the ASX:XRO stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Xero is a technology company originating from New Zealand, providing cloud-based accounting software, primarily for small and midsized enterprises, or SMEs, and accounting practices. As a first mover in the space for cloud-based accounting software, Xero has grown quickly to achieve dominant market share in New Zealand and Australia, displacing legacy providers. Xero has also expanded beyond its home region toward other English-speaking countries, primarily the UK and the US.
75GF Score
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