The Enterprise Value represents a more complete evaluation of a company’s size than the Market Cap as it adds the net debt to the value of the equity. It is defined as Market Cap plus Net Debt. Net Debt is calculated as Total Debt, Minority Interest and Preferred Stock minus Cash and Short Term Investments. This field is stated in British Pounds Sterling.
The Enterprise Value is based on the latest available figures for Debt & Cash, i.e. interim figures if these have been published since the annuals.
If EV is less than the Market Cap, the company has net cash.
If EV is greater than Market Cap, the company has net debt.
If EV is less than 0, there is more cash in the company than the value of the Mkt Cap and Debt combined! This signal is often appreciated by deep value investors.
Because EV is a capital structure-neutral metric, it is useful when comparing companies with diverse capital structures. In contrast, the PE Ratio will be significantly more volatile in companies that are highly leveraged.
| Ticker | Name | EV | StockRank™ |
|---|---|---|---|
| LON:SHEL | Shell | £211,763.10 | 94 |
| LON:AZN | AstraZeneca | £207,478.11 | 74 |
| LON:ULVR | Unilever | £129,988.92 | 88 |
| LON:BP. | BP | £115,499.68 | 53 |
| LON:BATS | British American Tobacco | £88,846.26 | 58 |