Hi guys. I am valuing a company using comparables employing enterprise value (think EV/EBITDA etc.). The company is public, but only the common shares are trading on the exchange, the preferred ones are not. So, how could I calculate the value of preferred stock when there's no trading conducted, hence no price to calculate the total value? There's only quantity and nominal value of preferred in financial statements.
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Just use book value. Although, have you checked a terminal for the preferred price? Hard to believe it hasn't changed hands at least a few times
The issue is that the book value (nominal value) of preferred is far lower (think 20x) than even the common stock, so it would be quite missleading. And unfortunately it hasn't changed hands ever - the company's founder is holding those since the firm's inception.
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