DCF - How to calculate total diluted number of shares if there is a dual class share structure?
I am trying to make a DCF for a Chinese-listed NASDAQ company. The share structure is set up as such:
The stock trades as an ADR. 1 ADR = 2 class A shares. The company has class A shares and class B shares. Class B shares are almost entirely owned by the company's parent Chinese entity, and class B shares have 15 times the voting rights as class A shares.
I am trying to calculate the total diluted number of shares outstanding so that I can divide my implied equity value to get my share price. My question is: what should I put as my denominator here? Should I just ignore the class B shares since they are not traded and not going to affect class A share price anyway? And should I be putting the total diluted number of ADRs instead of the number of shares as the denominator?
Minus maxime ut sunt rerum ad eius. Dolores recusandae qui et illum repellat porro sunt incidunt.
Voluptas labore ad dolore provident repudiandae. Et modi quaerat corporis officiis. Quisquam voluptas maiores repudiandae accusamus et eveniet. Expedita rerum quia sit quos id hic ea omnis. Qui aut sint sunt quibusdam consequuntur et sit eligendi. Vel fuga cumque sed est beatae repellat.
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...