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Spartech Corporation (NYSE:SEH)
Enterprise Value
$465 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, Spartech Corporation's enterprise value is $465 Mil. Spartech Corporation's operating income for the trailing twelve months (TTM) ended in Oct. 2012 was $16 Mil. Therefore, Spartech Corporation's EV/EBIT ratio for today is 29.78.

EV/EBITDA ratio is calculated as enterprise value divided by its EBITDA. As of today, Spartech Corporation's enterprise value is $465 Mil. Spartech Corporation's earnings before depreciation and amortization for the trailing twelve months (TTM) ended in Oct. 2012 was $47 Mil. Therefore, Spartech Corporation's EV/EBITDA ratio for today is 9.84.

EV/Revenue ratio is calculated as enterprise value divided by its Revenue. As of today, Spartech Corporation's enterprise value is $465 Mil. Spartech Corporation's revenue for the trailing twelve months (TTM) ended in Oct. 2012 was $1,149 Mil. Therefore, Spartech Corporation's EV/Revenue ratio for today is 0.40.


Definition

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

Spartech Corporation's Enterprise Value for the fiscal year that ended in Oct. 2012 is calculated as

Enterprise Value (A: Oct. 2012 )
=Market Cap+Preferred Stock+Long-Term Debt
=264.46976+0+112.288
+Short-Term Debt Without Lease+Minority Interest-Cash and Cash Equivalents
+22.636+0-1.092
=398

Spartech Corporation's Enterprise Value for the quarter that ended in Oct. 2012 is calculated as

Enterprise Value (Q: Oct. 2012 )
=Market Cap+Preferred Stock+Long-Term Debt
=265.11176+0+112.288
+Short-Term Debt Without Lease+Minority Interest-Cash and Cash Equivalents
+22.636+0-1.092
=399

* 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.

Spartech Corporation's EV/EBIT for today is

EV/EBIT ratio=Enterprise Value (Today)/Operating Income (TTM)
=464.974/15.615
=29.78

Spartech Corporation's current Enterprise Value is $465 Mil.
Spartech Corporation's Operating Income for the trailing twelve months (TTM) ended in Oct. 2012 was -0.526 (Jan. 2012 ) + 8.549 (Apr. 2012 ) + 5.14 (Jul. 2012 ) + 2.452 (Oct. 2012 ) = $16 Mil.

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

Spartech Corporation's EV/EBITDA for today is:

Spartech Corporation's current Enterprise Value is $465 Mil.
Spartech Corporation's Earnings Before Depreciation and Amortization for the trailing twelve months (TTM) ended in Oct. 2012 was 7.701 (Jan. 2012 ) + 16.747 (Apr. 2012 ) + 12.553 (Jul. 2012 ) + 10.255 (Oct. 2012 ) = $47 Mil.

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

Spartech Corporation's EV/Revenue for today is:

EV/Revenue ratio=Enterprise Value (Today)/Revenue (TTM)
=464.974/1149.355
=0.40

Spartech Corporation's current Enterprise Value is $465 Mil.
Spartech Corporation's Earnings Before Depreciation and Amortization for the trailing twelve months (TTM) ended in Oct. 2012 was 281.781 (Jan. 2012 ) + 298.323 (Apr. 2012 ) + 282.447 (Jul. 2012 ) + 286.804 (Oct. 2012 ) = $1,149 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.

Spartech Corporation Annual Data

Oct03Oct04Oct05Oct06Oct07Oct08Oct09Oct10Oct11Oct12
ev 9111,2699881,170826467481426281398

Spartech Corporation Quarterly Data

Jul10Oct10Jan11Apr11Jul11Oct11Jan12Apr12Jul12Oct12
ev 485426425395340281332307299399
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