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An easy way to size debt is to figure out a healthy debt coverage ratio (e.g. 1.35x) using cash flow proxy like EBITDA, and then back into appropriate debt figure based on that ratio.
Agree with A1 on the Debt/EBITDA ratio and many of its variations depending on specific business/industry. Other ratios we look at are interest coverage and debt to equity/debt to cap. Learned from past conversation with credit shops that some folks focus on more advanced ratios like total debt repayment capacity (TDRC) and fixed cost coverage ratio (FCCR)
Curious about this too because it seems everyone has their own way of doing it