![]() ![]() The most common additional group with such a claim is the company’s lenders. In other words, enterprise value recognises that in addition to a company’s shareholders, there may be other groups that have a claim over the company’s assets. ![]() Enterprise Valueīy contrast, a company’s enterprise value is the value of the company as a whole. Thus, a company’s equity value is the current market value of the company’s shares – whether those shares happen to be publicly traded or not. This difference is due to the fact the issued capital figure in the balance sheet shows what investors originally paid for the company’s shares whilst Kogan’s market capitalisation shows the current market value of those shares. The company’s balance sheet shows issued capital of only $167.3m. Importantly, the company’s market capitalisation of $476.0m is not the same as the notional equity value that is shown in Kogan’s balance sheet. Multiplying these two numbers together yields a market capitalisation for Kogan.Com Limited of $476.0m. Looking at this screen grab for Kogan.Com Limited, the online retailer, we can see that the company has a share price of $5.08 per share and has 93.71m shares outstanding. In the context of publicly traded companies, it is commonly referred to as a company’s market capitalisation, which is derived by multiplying the company’s current share price by the number of shares on issue. Equity value refers to the market value of the owners’ shares in a company. ![]()
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