Enterprise Value Calculator
Enterprise Value
Calculate enterprise value from components
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EV/EBITDA
Calculate EV/EBITDA multiple
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Formula
EV = Market Cap + Total Debt - Cash + Preferred Stock + Minority Interest
Frequently Asked Questions
What is enterprise value?
Enterprise value (EV) represents the total value of a company, including both equity and debt holders' claims minus cash. It is often considered a more comprehensive measure than market cap alone because it accounts for capital structure.
Why subtract cash from enterprise value?
Cash is subtracted because an acquirer effectively gets the company's cash upon purchase, reducing the net cost of acquisition. Enterprise value represents the theoretical takeover price.
What is a good EV/EBITDA ratio?
EV/EBITDA varies by industry. Generally, below 10 may indicate undervaluation, 10-15 is moderate, and above 15-20 may suggest overvaluation. Capital-intensive industries typically have lower ratios.
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