Is Enterprise Value on a debt and cash free basis the same as the Equity Value?
Enterprise Value = Equity + Debt; now leaving debt and cash out this seems to be the same as the equity value?
What is the difference? Could you give an example?
Thank you!
Answers:
Enterprise Value = Value of Equity + Value of Debt - Adjustments for Cash/Working Capital
So if a company had no debt and no excess cash then the enterprise value would equal the equity value.
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