What Is NTM?
Next twelve months refers to a forecast of revenue, EBITDA, earnings per share, or another metric covering the year that starts today, regardless of where the company sits in its fiscal calendar. The estimates typically come from consensus sell-side research or from a banker's own operating model, making NTM inherently a projection rather than a reported figure.
NTM is the forward-looking mirror of LTM. Where LTM answers what the company just earned, NTM answers what it is expected to earn next, and the gap between the two is a direct read on expected growth. A stock trading at 20x LTM earnings but 15x NTM earnings is priced for roughly 33% earnings growth over the coming year.
How NTM Figures Are Built
Because analyst estimates are published by fiscal year, NTM is usually a time-weighted blend of two forecast years. In September 2026, the NTM window for a December fiscal-year company runs from October 2026 through September 2027, which is three months of fiscal 2026 and nine months of fiscal 2027. NTM EPS = (3/12 x FY2026 EPS) + (9/12 x FY2027 EPS). Data providers such as FactSet and Bloomberg compute this blend continuously so the window always rolls forward with the calendar.
The same weighting doubles as a calendarization tool: blending fiscal-year estimates by month puts companies with June, September, and December year ends onto one comparable forward basis. The reliability of any NTM figure, though, is only as good as the consensus behind it, and thinly covered small caps may have stale or divergent estimates.
Why Forward Multiples Matter
Equity investors and bankers generally prefer NTM multiples for growth companies because trailing results understate the earnings base the market is paying for. A software business growing revenue 40% might look absurd at 25x LTM EBITDA yet reasonable at 17x NTM EBITDA, and comps pages routinely present both so readers can see growth embedded in the spread.
Forward multiples carry their own risk: if consensus proves too optimistic, a cheap-looking NTM multiple was an illusion. Skilled analysts pressure-test the estimates behind the multiple rather than taking them at face value, and in interviews, explaining when to prefer NTM over LTM, and why high-growth names widen the gap between them, is a reliable way to demonstrate market fluency.
