Enterprise Value Calculator
Calculate enterprise value from market cap, debt, minority interest, preferred shares, and cash. Compare total acquisition cost vs market capitalization.
What Is Enterprise Value?
Enterprise value (EV) represents the total theoretical acquisition cost of a company. Unlike market capitalization, EV accounts for debt, minority interest, preferred shares, and cash on hand.
Enterprise Value Formula
$$\text{EV} = \text{Market Cap} + \text{Debt} + \text{Minority Interest} + \text{Preferred Shares} - \text{Cash}$$
Market capitalization equals outstanding shares multiplied by share price. Cash is subtracted because an acquirer can use it to pay down debt after purchase.
EV vs Market Cap
Market cap alone understates the cost of buying a leveraged company. EV is preferred for comparing firms with different capital structures. See also our EBITDA Multiple Calculator for valuation multiples based on enterprise value.
Frequently Asked Questions
Why subtract cash from enterprise value?
Cash and equivalents can be used by the buyer to repay debt immediately after acquisition, effectively reducing the net purchase price.
When should I use market cap instead of EV?
Market cap is sufficient for companies with little debt and modest cash balances. Use EV when debt or cash materially affects the true acquisition cost.
What is minority interest?
Minority interest is the portion of a subsidiary owned by outside investors. EV includes it because the acquirer assumes that economic obligation.
Is enterprise value the same as equity value?
No. Equity value is essentially market capitalization. Enterprise value includes net debt and other claims, making it a broader measure of total firm value.
Related Tools
Word to HTML Converter
Base64 Decode Png
Square Pyramid Frustum Calculator
Histogram Maker
BCD to Decimal Converter
Net Ionic Equation Calculator
Metric to SAE Calculator
Dog Chocolate Toxicity
Convert Ascii To Octal
Average Clock Time Calculator
Day of Year Calendar
Pipe Vacuum Calculator
Random Bytes Generator
Weight Watchers Points Calculator
Catalan Number Generator
Ratio Calculator
Square Inch to Square Foot Converter
List Statistics Analyzer
Wood Beam Span Calculator
Twin Dragon Curve Generator