Enterprise Value (EV) is the total theoretical cost to acquire a company outright — what a buyer would pay to own every share, assume all debt, and collect all cash on the balance sheet.

Unlike Market Cap alone, EV gives a capital-structure-neutral view of a company's value, making it the preferred metric for comparing businesses with very different debt loads.

Market Cap
+ Total Debt
− Cash & Equivalents
─────────────────
= Enterprise Value

Debt is added because an acquirer assumes it. Cash is subtracted because it offsets the purchase price.

• EV / EBITDA — most common valuation multiple; compares EV to operating profit
• EV / Revenue — useful for high-growth or unprofitable companies
• EV / FCF — compares to free cash generation
• M&A pricing — acquisition offers are almost always stated as EV

• Market Cap only reflects equity value — shares × price
• EV includes debt holders and deducts cash
• A company with $10B market cap and $5B net debt has a $15B EV
• A cash-heavy company may have an EV below its market cap
• EV is preferred when comparing companies across capital structures