Enterprise Value (EV) Calculator

How it is calculated

Enterprise value converts the price of the shares into the price of the whole business:

EV = market cap + total debt − cash and equivalents
net debt = total debt − cash

Market capitalization is the share price times shares outstanding. Total debt is what the company owes lenders, and cash includes cash equivalents that can be used right away. All three figures must be in the same currency and the same unit (all in thousands or all in millions, for example). Market cap must be above 0, and debt and cash cannot be negative; if you leave debt or cash empty, each counts as 0. Net debt is negative when cash exceeds debt, which means the business holds more cash than it owes.

Common mistakes

• Subtracting debt instead of adding it. The debt is taken on by the buyer and increases the cost; only cash is subtracted.
• Entering net debt in the debt field and cash again in the cash field. That subtracts the cash twice. Enter gross total debt and the cash balance separately, or net debt alone with cash left empty.
• Mixing units, for example market cap in millions and debt in thousands. All inputs must share one unit, or the EV is meaningless.
• Using the book value of equity instead of the market cap. EV is built on the current market value of the shares.
• Leaving out items that count as debt in practice, such as leases or preferred stock, or counting restricted cash as free cash. The tool adds only the two numbers you provide.