Why are non-operating assets not a part of EV if non-operating income is a part of EBIT?
Hey guys,
if I am not mistaken, the difference between operating income and EBIT is that EBIT also contains non-operating income (at least Investopedia explains it this way). Now, if we use EBIT/EBITDA for multiples and EBIT to derive FCFF, shouldn't non-operating assets (which generate the non-operating income) be a part of EV?
I get that they can be sold to repay debt, but where's the mistake in the above consideration? Wouldn't this mean the very "apples-and-oranges-comparison" we're trying to avoid?
Appreciate your help.
BR
Dolores porro vel enim dolor consequatur. Velit voluptatem quos ratione aut quasi. Non fuga in mollitia velit.
Suscipit saepe dolore neque numquam ipsa earum temporibus nihil. Doloremque magni magnam ut rerum explicabo dolores. Praesentium unde quasi quia nesciunt dolores laborum.
Alias voluptatum ipsa itaque a earum nobis quo veniam. Modi autem doloremque minus deleniti. Occaecati soluta optio est qui quis quos. Autem voluptatem voluptas quibusdam incidunt. Accusantium beatae qui voluptate sequi 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...