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Electro Rent Corp (NAS:ELRC)
Enterprise Value
$339.5 Mil (As of Today)

Think of enterprise value as the theoretical takeover price. It is more comprehensive than market capitalization (market cap), which only includes common equity. Enterprise Value is calculated as the market cap plus debt and minority interest and preferred shares, minus total cash and cash equivalents.

EV/EBIT ratio is calculated as enterprise value divided by its EBIT. As of today, Electro Rent Corp's enterprise value is $339.5 Mil. Electro Rent Corp's operating income for the trailing twelve months (TTM) ended in Aug. 2014 was $30.8 Mil. Therefore, Electro Rent Corp's EV/EBIT ratio for today is 11.02.

EV/EBITDA ratio is calculated as enterprise value divided by its EBITDA. As of today, Electro Rent Corp's enterprise value is $339.5 Mil. Electro Rent Corp's earnings before depreciation and amortization for the trailing twelve months (TTM) ended in Aug. 2014 was $88.6 Mil. Therefore, Electro Rent Corp's EV/EBITDA ratio for today is 3.83.

EV/Revenue ratio is calculated as enterprise value divided by its Revenue. As of today, Electro Rent Corp's enterprise value is $339.5 Mil. Electro Rent Corp's revenue for the trailing twelve months (TTM) ended in Aug. 2014 was $242.8 Mil. Therefore, Electro Rent Corp's EV/Revenue ratio for today is 1.40.


Definition

Enterprise Value is calculated as the market cap plus debt and minority interest and preferred shares, minus total cash and cash equivalents.

Electro Rent Corp's Enterprise Value for the fiscal year that ended in May. 2014 is calculated as

Enterprise Value (A: May. 2014 )
=Market Cap+Preferred Stock+Long-Term Debt
=387.7615+0+0
+Short-Term Debt Without Lease+Minority Interest-Cash and Cash Equivalents
+0+0-5.946
=381.8

Electro Rent Corp's Enterprise Value for the quarter that ended in Aug. 2014 is calculated as

Enterprise Value (Q: Aug. 2014 )
=Market Cap+Preferred Stock+Long-Term Debt
=363.2713+0+0
+Short-Term Debt Without Lease+Minority Interest-Cash and Cash Equivalents
+0+0-3.974
=359.3

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.


Explanation

When an investor buy a company, the investor needs to pay not only the common shares, he/she also needs to pay the shareholders of Preferred Stocks. He also assumes the debt of the company, and receives the cash on the company's balance sheet.

If a company has more cash than debt, the investor actually pays less than the Market Cap because he immediately owns the cash once the transaction goes through.

The market value of Preferred Stock needs to be added to the market value of common stocks in the calculation of enterprise value.

For the companies with the same Market Cap, the smaller the Enterprise Value is, the cheaper the company is.

Enterprise Value can be negative when the company's net cash is more than its Market Cap. In this case the investor is basically getting the company for free and get paid for that.

1. EV/EBIT ratio is calculated as enterprise value divided by its EBIT.

Electro Rent Corp's EV/EBIT for today is

EV/EBIT ratio=Enterprise Value (Today)/Operating Income (TTM)
=339.526/30.812
=11.02

Electro Rent Corp's current Enterprise Value is $339.5 Mil.
Electro Rent Corp's Operating Income for the trailing twelve months (TTM) ended in Aug. 2014 was 8.912 (Nov. 2013 ) + 7.185 (Feb. 2014 ) + 7.256 (May. 2014 ) + 7.459 (Aug. 2014 ) = $30.8 Mil.

2. EV/EBITDA ratio is calculated as enterprise value divided by its EBITDA.

Electro Rent Corp's EV/EBITDA for today is:

Electro Rent Corp's current Enterprise Value is $339.5 Mil.
Electro Rent Corp's Earnings Before Depreciation and Amortization for the trailing twelve months (TTM) ended in Aug. 2014 was 23.469 (Nov. 2013 ) + 21.859 (Feb. 2014 ) + 21.62 (May. 2014 ) + 21.627 (Aug. 2014 ) = $88.6 Mil.

3. EV/Revenue ratio is calculated as enterprise value divided by its Revenue.

Electro Rent Corp's EV/Revenue for today is:

EV/Revenue ratio=Enterprise Value (Today)/Revenue (TTM)
=339.526/242.84
=1.40

Electro Rent Corp's current Enterprise Value is $339.5 Mil.
Electro Rent Corp's Earnings Before Depreciation and Amortization for the trailing twelve months (TTM) ended in Aug. 2014 was 57.876 (Nov. 2013 ) + 62.016 (Feb. 2014 ) + 61.077 (May. 2014 ) + 61.871 (Aug. 2014 ) = $242.8 Mil.

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.


Related Terms

Market Cap, Preferred Stock, Long-Term Debt, Cash and Cash Equivalents


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

Electro Rent Corp Annual Data

May05May06May07May08May09May10May11May12May13May14
ev 213.8339.7291.8292.8160.7279.4326.4322.7407.8381.8

Electro Rent Corp Quarterly Data

May12Aug12Nov12Feb13May13Aug13Nov13Feb14May14Aug14
ev 322.7399.2367.0398.1407.8407.5512.2433.1381.8359.3
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