enterprise value

An economic measure reflecting the market value of a company as a whole business. It is the sum of claims of all security-holders: common and preferred equity holders, minority shareholders, debtholders and others. Enterprise value is calculated as the sum of a company’s market capitalization and its net debt. It tells you how much you would need to pay to buy an entire public company. Some analysts believe it provides a clearer picture of the “real value” than market capitalization.