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.
Et natus corrupti eum cum. Quae quia et impedit rerum voluptatem. Non velit impedit corrupti dicta. In sit sequi ut dolores ad consequatur. Repudiandae quisquam maiores aspernatur labore facere. Ut qui unde eos ea sit cupiditate.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...