Enterprise Value

A measure of a company's total value. It is a combination of the value of common stock, preferred stock, cash, and debt. Determining the value of public companies is much easier than private companies which don't make their financials available to the public. You can use the comparable company analysis approach, which involves looking for similar public companies. Using findings from a private company's closest public competitors, you can determine its value by using the EBITDA or enterprise value multiple.