Definition
Enterprise value
What it would cost to own the whole business: the equity's market value plus the debt the buyer assumes, minus the cash that comes along with the keys. It is the numerator of the capital-structure-neutral multiples (EV/EBITDA, EV/Sales), because it prices the enterprise regardless of how the current owners chose to finance it.
EV = Market cap + Total debt − Cash & equivalents
- Market cap
- the equity leg — a market quantity, repriced every trading day.
- Debt
- assumed by the buyer, so it adds to the price of the whole enterprise.
- Cash
- comes with the purchase and nets against the price — a company is cheaper by the cash it holds.
Balance sheet (debt and cash legs); market cap is market data. 10-K Item 8 — long-term debt and cash & equivalents on the balance sheet. The market-cap leg needs a share price no filing carries; Echelon shows the filed legs and names the missing one.
XBRL concepts Echelon grounds to: LongTermDebtNoncurrent · CashAndCashEquivalentsAtCarryingValue
- Ill-defined for banks and insurers — deposits and float blur the line between operating liability and funding debt.
- Operating-lease obligations sit outside many debt tags; a thorough EV build reads the debt footnote, not one line.
Educational use only — not investment advice. Figures come from public SEC filings; Echelon teaches you to analyze data, it never recommends buying or selling any security.