P/E ratio calculations with minority interest
I would like to check if there are any adjustments needed when calculating P/E ratio (market cap/net income) in a company with minority interest. Should we use net income before or after minority interests to calculate the P/E ratio?
After... the minority has a claim on some profit or loss
In that case, do we also have to make any adjustments for the market cap to account for after-minority interest? I am confused if this is an apples-to-apples comparison.
The equity shareholders are junior to the minority in the capital structure so the market cap is already post minority interest. As long as you use post minority EPS you are good.
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