Hello my friends, I need your help on one question:
Enterprise value as you know is, basically, equity + net debt. In calculating net debt, do I have to subtract short term investments from total debt? I know that I definitely have to subtract "cash and equivalents" but some companies, in addition to that, also have a separate "Short term investment" item on its balance sheet...and I am just not sure whether I have to subtract this ST investment item too, to get to net debt. What do you think?
Thanks a lot for your help in advance..
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http://www.wallstreetoasis.com/search/google?cx=010991802143891690253%3…
A similar question has been asked before on a few of these topics. Hope that helps!
Yes, they must be taken out because, like cash, they will be quickly recouped by the buyer.
Yes.
Yes, take it out. In some groups, your MD may make you also factor in long term investments depending on what they are.
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