Equity value versus the value of the whole operating business.
| Concept | Explanation | |---|---| | Market capitalization | Share price multiplied by shares outstanding. | | Enterprise value | Market cap plus debt and certain claims, minus cash and cash-like assets. | | Equity value | Value attributable to common shareholders. | | Operating value | Value of the underlying business operations. | | Per-share value | Equity value divided by diluted shares outstanding. |
Enterprise-value multiples are useful when comparing companies with different debt and cash structures. Equity multiples focus directly on the shareholder claim.