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You need to adjust for cash and debt to get the enterprise value. If you do so, you’ll find that Tesla is worth about 50% less than it was.
by earthshot 7y ago
You need to adjust for cash and debt to get the enterprise value. If you do so, you’ll find that Tesla is worth about 50% less than it was.
- gpm 7y agoDo you mean more? Because according to the comment above debt is 11B, and I happen to know that they have ~2B cash on hand, so roughly speaking enterprise value should be 9B larger than market cap right now, and it should have been less than 600M above market cap back then (their old debt value also listed in a comment above).
- atdrummond 7y agoMisread, please ignore.
- TorKlingberg 7y agoThat depends on what you are trying to calculate. If you want the market value of a company it's the market cap, # of shares * share price. If you want the value of the company as a going concern it's market cap + debt - cash.
- Reason077 7y agoEnterprise value is not derived from market cap. Rather, market capitalisation reflects investor’s assessment of the enterprise value. Whether rational or not, this already takes cash and debt positions into account.
- kgwgk 7y agohttps://en.m.wikipedia.org/wiki/Enterprise_value https://en.m.wikipedia.org/wiki/Enterprise_value
- ajross 7y agoThat's not right either. The (incorrect) headline isn't about what Tesla is "worth" to Apple, it's what the purchase price would have been. The market has already priced in things like growth expectations and debt load, that's the whole point of having a stock market in the first place.