Equity Value
Equity Value represents the total value of a company’s equity as perceived by the market. Think about it as the value of the company available to common shareholders after accounting for all obligations to debt holders, preferred shareholders and others who have claims before common shareholders.
Formula
Equity Value = Share Price * Total # of Outstanding Shares
Example
Getting to Equity Value from Enterprise Value
Equity Value = Enterprise Value - Net Debt - Minority Interest - Preferred Stock
This formula basically says “everybody who gets paid before common shareholders must be paid before determining how much can be divided up for common shareholders”.
In the room
Half of the EV bridge, and the half that trips people up. Equity value is what's left for common shareholders after everyone with a prior claim is paid — debt holders, preferred holders, minority interests.