Interest Coverage Ratio

Enterprise Value (EV), also referred to as Business Enterprise Value (BEV), reflects the market value of the entire business. In laymen’s terms, it’s the amount an acquirer would have to pay to buy a business. In valuation terms, enterprise value represents the market value of the company’s total operating assets.

How to calculate the Enterprise Value (EV)

Market Capitalization
(+) Total Debt
(+) Minority Interest and Other Liabilities
(+) Preferred Equity
(-) Cash And Short Term Investments
(-) Long Term Investments
(-) Other Adjustments
(=) Enterprise Value (EV)

Enterprise value is not meaningful for all companies. Banks and similar financial institutionals must operate with a lot of debt on their balance sheets in order to function, so equity value tends to be the more appropriate measure of business value.

Note, Enterprise Value differs from Total Enterprise Value (TEV) because non-operating assets are not deducted from TEV.

Since California First Leasing is not such a financial institutional, we can calculate enterprise value as follows:

Market Capitalization [ $200.2 M ]
(+) Total Debt [ zero ]
(+) Minority Interest and Other Liabilities [ NA ]
(+) Preferred Equity [ NA ]
(-) Cash And Short Term Investments [ -$21.603 M ]
(-) Long Term Investments [ -$242.5 M ]
(-) Other Adjustments [ $242.5 M ]
(=) Enterprise Value (EV) (USD) [ $178.5 M ]
(x) FX Conversion Rate (USD/presentment) [ 1.00 ]
(=) Enterprise Value (EV) (presentment) [ 178.5 M ]

The tables below summarizes the trend in California First Leasing’s Market Capitalization and Enterprise Value (EV) over the last five years: