Can someone explain this question? IB interview prep, thanks.
"With a DCF analysis, if you include an expense within FCFImplied Equity Value."
Why is it that if I project UFCF by factoring in operating leases as a non-cash expense, lowering NOPAT and Operating Income, I cannot capitalize the operating leases and subtract them as a debt-like item when moving from Implied Enterprise Value to Implied Equity Value? Why would this be double-counting?
Thanks WSO.
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