About the Enterprise Value Calculator
Enterprise value (EV) measures what it would cost to buy a whole business: the market value of its shares plus the debt and other claims an acquirer would take on, minus the cash it would receive. This enterprise value calculator builds EV from the share price, shares outstanding, total debt, preferred stock, minority (non-controlling) interest and cash, and then computes the valuation multiples analysts use most — EV/EBITDA, EV/EBIT and EV/Sales.
Because EV is capital-structure neutral, these multiples let you compare companies with very different amounts of debt, which a price-to-earnings ratio cannot do. Use it to screen stocks, sanity-check an acquisition price, or compare a company against its peers.
Enter every amount in the same units — for example, all in millions with shares outstanding also in millions. Use the latest balance-sheet figures for debt and cash and trailing twelve-month (TTM) or forward figures for EBITDA, EBIT and revenue, consistently across the companies you compare.
With the default inputs, the enterprise value is $50,500.00. Change any value above to recalculate instantly.
How to use the enterprise value calculator
- 1Enter the share price and diluted shares outstanding.
- 2Enter total debt, preferred stock and minority interest from the latest balance sheet, in the same units.
- 3Enter cash and short-term investments.
- 4Add TTM EBITDA, EBIT and revenue to get the valuation multiples.
- 5Compare the multiples with peers in the same industry.
Formula and method
Market capitalization is the share price times diluted shares outstanding. Enterprise value adds the claims of other capital providers — debt holders, preferred shareholders and minority owners of consolidated subsidiaries — because a buyer would have to repay or assume them, and subtracts cash and short-term investments because a buyer effectively gets that cash back.
Dividing EV by EBITDA, EBIT or revenue gives multiples that compare the value of the entire business with profits or sales available to all capital providers. Multiples are shown only when the denominator is positive; a negative EBITDA or EBIT makes the ratio meaningless.
- EV
- Enterprise value
- EBITDA
- Earnings before interest, taxes, depreciation and amortization
- EBIT
- Earnings before interest and taxes (operating income)
Worked examples
Mid-cap industrial with net debt (figures in $ millions)
A market cap of $42.5 billion plus $12 billion of debt and $0.5 billion of minority interest, minus $4.5 billion of cash, gives an enterprise value of $50.5 billion. At $6 billion of EBITDA that is 8.4× EV/EBITDA.
Cash-rich tech company
With $45 billion more cash than debt, EV ($459 billion) is lower than the $504 billion market cap. The business trades at 11.5× EBITDA and 4.8× sales.
Small cap with preferred stock
Debt and preferred stock make up a large part of this company’s value: EV is $7.75 billion against a $4.8 billion market cap. At 12.5× EBITDA it looks far more expensive than its market cap alone suggests.
Frequently asked questions
What is enterprise value?+
Enterprise value is the total value of a company’s operating business to all capital providers: equity market value plus debt, preferred stock and minority interest, minus cash. It approximates the takeover price of the whole company.
Why is cash subtracted from enterprise value?+
An acquirer who buys the company gets its cash, which could be used to pay down debt or returned to shareholders, so it reduces the net cost of the purchase. Only excess cash beyond working needs should strictly be subtracted, but most data providers subtract all cash and short-term investments.
What is a good EV/EBITDA ratio?+
It depends on the industry and growth. Mature, capital-heavy businesses often trade around 6–10× EBITDA, while fast-growing software firms can trade at 20× or more. Compare a company with its own history and close peers rather than a single benchmark.
Why use EV/EBITDA instead of P/E?+
P/E is affected by how much debt a company uses and by non-cash charges like depreciation. EV/EBITDA compares the whole capital structure with operating earnings before financing and depreciation, which makes companies with different leverage more comparable.
Can enterprise value be negative?+
Yes, if cash exceeds market capitalization plus debt. It is uncommon and usually happens with small companies that the market expects to lose money, so the cash on the balance sheet may not last.
Results are estimates for educational purposes and are not financial advice. Rates, fees and terms vary — confirm with your lender or a licensed advisor before making decisions.