Hello all,
I know that we use NAV model to value E&P companies. So in NAV we use Revenue-production cost-capex-taxes as cash flows
Why don't we subtract interest expense here, as NAV is only for equity holders. Thanks.
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What you outlined is an asset level NAV. Usually you’ll overlay a corporate model which will incorporate debt.
Thanks!
So you mean while calculating a firm's NAV, I would need to subtract interest?
So it would be like adding all asset level NAV's - tax adjusted interest expense?
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