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  2. During a recent round of interviews with several banks, headhunters sent across a number of potential technical questions that they said I should be very comfortable with. However, through all of my interviews I was never actually asked any technical ques ...

    53 comments6 May 2020 -

  3. I'm currently studying for CFA level III and going through some valuation concepts for upcoming interviews, and I'm a bit confused with some of the notions surrounding enterprise value. In Breaking Into Wall Street's IB interview guide, it ...

    17 comments21 Oct 2019 - Analyst 1 in IB - Gen

  4. Hi guys, I've recently had a series of EV questions thrown at me during one interview and wanted your opinion whether I've answered them correctly... They all had to do with what happens to enterprise value when you issue new equity or debt. The ...

    32 comments13 Aug 2019 -

  5. Why do we subtract cash when calculating enterprise value? Shouldn't we be paying for the cash on hand too? If I am selling my company, why would I pay someone to take my excess cash? Before we answer this question lets make sure understand what ente ...

    47 comments12 Apr 2019 -

  6. Hi! I hope this is the right forum for my question, Im new to WSO:) In short, I struggle with two things: Retained Earnings To my understanding represents the total sum of all [Net Income- Dividends] paid over all FYs of a companys lifetime. Now, when I c ...

    16 comments31 May 2019 -

  7. Hi all, I have some questions on an undying topic that's continuously discussed on the street: how tax rate affects EV valuation of companies. Some people argue it's positively correlated to EV while others argue it's the opposite. Based on ...

    24 comments26 Sep 2018 -

  8. Aswath Damodaran's blog stock market Market Cap enterprise value aswath damodaran Firm value Blog ...

    29 comments3 Aug 2013 -

  9. EV of a Private company

    Investment Banking

    How do you find the enterprise value of a private company? I have the financials, is it just paid in capital + net debt? Or would it be the assets (market value) + net debt. Thank you! enterprise value ...

    21 comments27 Dec 2017 -

  10. Enterprise Value

    Investment Banking

    If company raises debt, the cash increase offsets the increase in debt, therefore the Enterprise Value will stay the same. But how come the Equity Value stays the same? What about the higher interest expenses and principal repayments associated with more ...

    18 comments16 May 2018 -

  11. Hey fellow monkeys, I was wondering if the per share value of a stock given its current fundamentals is reliable in terms of understanding whether it is undervalued or overvalued. For example, if I calculate the equity value divided by the shares outstand ...

    12 comments27 Sep 2019 -

  12. I got asked about when a company would have a negative enterprise value in my superday. I answered when its cash balance is greater than its combined debt and equity (he told me to ignore the other stuff). I mentioned that banks sometimes have a negative ...

    16 comments18 Aug 2016 -

  13. Hey guys, Would really appreciate some help with a probably really basic accounting question. When you purchase a company, let's say through an LBO.... what happens to the cash of the target? Does the seller take it all with them? So, once you own th ...

    13 comments26 Feb 2016 -

  14. Hi guys, Some sources call EV the "price that an acquirer really pays''. But in reality the purchase price is always the stock price plus certain premium. Does it mean that EV is just a 'theoretical price' for the business? If so ...

    11 comments27 Aug 2012 -

  15. Hi guys, I recently ran into these EV questions when preparing for interviews. I am not sure about the answers and I would really appreciate if someone could explain a bit. (1) If the current EV of a company is $150mm (equity value =$150mm, book value of ...

    8 comments30 Apr 2017 -

  16. EV: Price or Value?

    Investment Banking

    Guys, I can't help, but I always feel like price is confused with value when talking about "Net Debt" in the most common definition of Enterprise Value (EV). We talk about Enterprise Value, but in fact, we should say it's the Purchase ...

    10 comments27 Jul 2011 -

  17. What’s an equity investor?

    Investment Banking

    So when we talk about equity vs enterprise value, we say equity value pertains to what's only available to EQUITY investors within a firm. I know this but how can I think about this conceptual? Also when we compare enterprise value to equity value in ...

    5 comments10 Jan 2020 -

  18. I understand that you don't really use equity value / EBITDA because you 're comparing apples to oranges (Eq. val. is available to only shareholders while ebitda is available to all investors). But if that's the case, then why is it that yo ...

    7 comments22 Oct 2015 -

  19. why is the post money EV / EBITDA multiple preferred over the pre money mulitple enterprise value ...

    7 comments6 Aug 2015 -

  20. Hey guys! I've been confused lately by the way experts interpret the way Enterprise Value changes when Debt-to-Equity ratio changes. Some of them say that since D/E changes, tax shields are expected, so EV is going up. But if you think of it this way ...

    7 comments27 Aug 2012 -

  21. I have 14 credits, first few solid answers get SBs. Let's assume a parent company owns, say, 80% of a subsidiary. How is the parent's 80% majority interest accounted for within its enterprise value? Is it assumed that the market valuation of the ...

    7 comments12 Apr 2012 -

  22. which is used? why? im assuming book value of debt. if a company buys another wont it really just pay for the equity + some premium and assume the debt without paying for it?> enterprise value is just a theoretical value used for ratios/ comps right? e ...

    7 comments10 Mar 2009 -

  23. So how do you get valuation when you acquire less than 50% of the company's equity and no change in ownership happens? I mean, you can certainly value the 100% company and multiply the EV / Equity Value by % you wanna acquire. But do you need to get ...

    4 comments17 Aug 2019 - Intern in IB-M&A

  24. Tax shield value

    Corporate Finance, Development and Strategy

    Hi, Unlevered firm value (FVu) is generally agreed to be equal to levered firm value (FVl)- tax shield value (VTS). So FVl is greater than FVu, thanks to tax benefits. Ultimately, this greater value (VTS) benefits to shareholders (as debtholders revenue i ...

    5 comments26 Jun 2017 -

  25. Questions on Total Debt and EV

    Investment Banking

    Three questions: (1) What, specifically, do you include from Liabilities in calculating Total Debt, for the purpose of calculating EV? Similarly, what specifically do you include in the calculation of Non-convertible debt? (2) How does Enterprise Value di ...

    5 comments11 Mar 2012 -

  26. Enterprise value in distress

    Investment Banking

    Im having trouble working my way through assessing the enterprise value in the situation I describe below, and I was hoping for some advice: ...

    4 comments18 Dec 2019 -

  27. Hey Everybody, I apologize if this is in the wrong forum, but doing interview prep and ran across this question for calculating EV that I don't get. Super lost, and sorry if this is a stupid question...I got a lot to learn. I am given the share count ...

    3 comments22 Mar 2020 -

  28. Hey guys I have a rather basic question about Enterprise Value calculations. I know EV calculations (EV = MarketCap- net debt) by heart and I have doen adjsutments for preffered stocks and minorities. However, during my internship I always had to adjust f ...

    4 comments13 Feb 2018 -

  29. EV Questions

    Investment Banking

    What happens when a company issues a $100mm stock repurchase? Assuming equity value decreases by taking shares outstanding out of the equation, which is offset by decrease in cash (assuming we use cash to repurchase shares) so EV remains neutral. Just wan ...

    3 comments1 Aug 2019 -

  30. How would you guys answer this question with respect to EV /EBIT EV / EBITDA I don't think its a straight forward good or bad answer, I think it depends on things such as relative comparison to other companies in the industry...is a higher enterprise ...

    4 comments2 Jan 2013 -

  31. Hey everyone, Quick question cause I am confused. If a company has 100 shares in the market with price of 1 dollar (or marketcap of 100 dollars) and cash of 50 dollars, and debt of 10 dollars. The EV is 100 +40 = 140 1) Why is it that having cash actually ...

    4 comments16 Dec 2012 -

  32. Might be a dumb question but.... I know EV = market cap plus debt, minority interest and preferred shares, minus total cash and cash equivalents but what is the market cap. of an all equity, private company that doesn't have # of shares and price to ...

    4 comments2 Nov 2011 -

  33. Hey guys, I am wondering about the correct theoretical explanation for two valuation-related issues and would be glad if someone could shed some light on these. 1) When going from Enterprise Value (EV) to equity value (EqV), we are adding non-operating as ...

    4 comments23 Jul 2011 -

  34. Hi everyone, Quick question on something that has been confusing me from some of the interview guides. When a company issues dividends, many of the guides say that this does not impact enterprise value. Given the formula for enterprise value, I am having ...

    3 comments21 Sep 2018 -

  35. Calculating IRR of cash flows with terminal value

    Investing, Markets & Macroeconomics

    I have a project with an initial outlay (Year 0) and 10 years of forecasted positive FCFFs and FCFEs. After 10 years, I use a Gordon/Perpetuity Growth Model to determine Terminal Value. I built DCF model and discounted FCFFs with WACC (to arrive at Enterp ...

    3 comments20 Sep 2016 -

  36. EV Formula for Banks...?

    Investment Banking

    I have an interview coming up on monday for a FIG position. And I got some open questions about valuation: Obviously it is most appropriate to apply DDM or Equity Comps (such as PE, P/B) for a bank valuation. What is then the enterprise value of a bank? T ...

    3 comments12 Apr 2019 -

  37. Interest Bearing Debt

    Investment Banking

    Why is only interest bearing debt included in EV? I understand that sometimes you include pension liabilities, capital leases, etc., but why aren't all liabilities included? Wouldn't these need to be paid off by an acquirer? enterprise value ban ...

    3 comments23 May 2013 -

  38. Enterprise Value Question

    Investment Banking

    When calculating enterprise value, do you include restricted cash? For my particular company, the restricted cash serves as cash collateral for its outstanding LCs enterprise value ...

    3 comments28 Mar 2011 -

  39. I need help on EV/EBIDTA

    Investment Banking

    I have a mock M&A modeling to do as part of an assignment in the recruiting process for an IB. It's a pretty basic accretion analysis. They provided the Excel spread sheet and I have to fill it out. From the outset, I have to enter a median EV /E ...

    3 comments12 Oct 2010 -

  40. Hi guys, I'm clearly missing out on something as I'm a bit confused about something. Sorry, this might sound silly: To value public companies (find the enterprise value), why can't you just find the equity value (by current share price x fu ...

    2 comments23 May 2018 -

  41. why is the post money EV / EBITDA multiple preferred over the pre money mulitple. enterprise value ...

    2 comments19 Jun 2015 -

  42. Enterprise value calculation for a bank

    Investing, Markets & Macroeconomics

    To calculate enterprise value, I need to add debt and subtract cash from equity. The company issues notes and repos. Are those considered debt for the sake of this calculation? The company (it is a bank) temporarily owns short-term loans before selling th ...

    1 comment18 Nov 2019 -

  43. How do you market cap to enterprise value 12:23-12:45 How do you calculate enterprise value for a company? 11:05-11:33 Let's talk about technical questions. What's the difference between firm value and equity value? 13:26-15:59 When you say EV t ...

    4 Apr 2018 - Anonymous Monkey

  44. Hi, It would be nice if someone can clarify my understanding. (1) I would like to check if my understanding of enterprise value is correct, refer to the image above Next is with regards to consolidated statements (Example company A&B consolidated stat ...

    6 May 2020 -

  45. Enterprise Value (also known as EV) is a metric that attempts to reflect the market value of a firm. It can be used as an alternative to market capitalization. Essentially, Enterprise Value attempts to provide a more accurate valuation aimed at a buyer. W ...

    27 Aug 2012 -

  46. When doing something like EV /SALES or EV / EBITDA should you use an EV based on a weighted average shares market value since that captures share changes over time (like IS items) or is it OK to go ahead and use an EV based on the latest fully diluted mar ...

    1 comment29 May 2018 -

  47. Background: For Joel Greenblatt's "Magic Formula," he defines earnings yield as EBIT/ EV. Further, he defines EV as equity value including preferred equity + net interest bearing debt. I'm looking at a potential investment in Socket Mo ...

    1 comment19 Feb 2018 -

  48. How's it going, I was assigned to do a comparable company analysis for homework. However, I'm not sure if I did it correctly. The instructions were very vague so I had to do research and do the best(?) I can. This is the first time I attempt doi ...

    1 comment23 Mar 2017 -

  49. Can someone please help me on how to value the equity of consolidated company (Parent) who has two investments in associate (Ownership ratio: 25% and 40%, respectively) whose business is core of the parent. these associate companies are accounted under eq ...

    5 Mar 2016 -

  50. WDC- SNDK Merger

    Investment Banking

    Hi all, I'm trying to reconcile and make sense of the announced deal consideration structure for SNDK. From reading the SEC filings, the deal consideration is $18.9 bn. However in the presentation Western Digital's Acquisition of SanDisk, dated ...

    1 comment28 Jan 2016 -

  51. Hi there, I'm currently writing a paper about how to apply control premiums and minority discounts in terms of multiple valuation. My focus is to valuate a private company with publicly traded comparable companies. So during my research I came across ...

    18 Jun 2015 -

  52. EV: Unconsolidated Assets

    Equity Research

    Curious to hear people's thoughts on how you handle unconsolidated assets/entities (<50% ownership) in your EV calculation. Looking to get a better grasp on it. enterprise value ...

    1 comment19 Oct 2012 -

  53. Is anyone familiar with the "creation value" concept in distressed valuation? Ie. if the current capital structure is 500 senior secured term loan, and 500 of unsecured subordinated notes. Say you purchase the notes for $0.50 on the dollar. Ofte ...

    1 comment14 Oct 2012 -

  54. Auto Manufacturers- EV calc

    Equity Research

    Howdy, I'm looking to calculate the industrial enterprise value for an auto manufacturer. Any thoughts on the best way to strip out the financial business? Thanks, redted enterprise value ...

    5 Nov 2011 -