Trailing Twelve Months

Also known as: TTM, LTM, Last Twelve Months

Trailing twelve months (TTM or LTM) is a company’s financial performance over the most recent twelve months, used in diligence to capture the current run-rate of the business.

Trailing twelve months, abbreviated TTM or LTM (last twelve months), measures performance over the most recent twelve-month period rather than a calendar or fiscal year. It is calculated by taking the latest full year and rolling it forward, swapping in recent months for older ones.

Why diligence leans on it

A fiscal year can be stale by the time a deal is underway. TTM gives buyers the freshest twelve-month view of revenue, EBITDA, and margins, which better reflects the current state of the business and its working capital needs.

A common pitfall

For seasonal businesses, the TTM window must include a full seasonal cycle or it can distort the picture. Mismatching periods is a frequent source of error in quick valuations.

Related terms

EBITDA

EBITDA is earnings before interest, taxes, depreciation, and amortization, a widely used proxy for a company’s core operating profitability.

Quality of Earnings

A Quality of Earnings (QoE) analysis assesses how sustainable and accurate a company’s reported earnings are, separating durable operating profit from one-time or accounting-driven boosts.

Comparable Company Analysis

Comparable Company Analysis, often called comps, values a company by applying the valuation multiples of similar public companies to its own financial metrics.

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