EMC, usually referred to as market capitalization or market cap, is the total value of a publicly traded company’s outstanding common shares owned by stockholders. It is calculated by multiplying the price of a stock by its total number of outstanding shares. For example, a company with 20 million shares selling at $50 a share would have a market cap of $1 billion.Continue reading What is Equity Market Capitalization (EMC)?
For business owners and financial managers, cash flow management is crucial to the survival of the business and it is associated with that business throughout its operation, so the role of cash flow management is very important. in the business activities of the enterprise. So what is cash flow? What is net cash flow, and is there any method to manage cash flow in the business effectively? Let’s find out.Continue reading What is Cash Flow? Cash Flow Management
Financial Statements (a.k.a Financial Reports) are formal records of the financial activities and position of a business at a specific point in time. Relevant financial information is presented in a structured manner and in a form which is easy to understand.Continue reading What is Financial Statement / Report?
Enterprise value (EV), a.k.a total enterprise value (TEV) or firm value (FV), is a metric to reflect the market value of a business and is often used as a more comprehensive alternative to EMC (equity market capitalization). It is a sum of claims by all claimants: creditors (secured and unsecured) and shareholders (preferred and common). Enterprise value is one of the fundamental metrics used in business valuation, financial analysis, accounting, portfolio analysis, and risk analysis.
EBITDA stands for Earning Before Interest, Taxes, Depreciations and Amortizations is one of the most important measures of a firm’s profitability. It is calculated as Net Income + Interest + Income Taxes + Depreciations + Amortizations. Or, EBITDA = EBIT + Depreciations + Amortizations.Continue reading What is EBITDA?
EBIT stands for Earning Before Interest and Taxes. EBIT (along with EBITDA) is one of the most important metrics to measure a firm’s profitability that includes incomes and expenses except interest expenses and income tax enspenses. In other words, EBIT = Net Income + Interest + Income Taxes.Continue reading What is EBIT?
Merger and Acquisition model is one of the most popular financial models that is usually used before and during mergers and acquisitions by merging the financial statements of the acquiring company and the acquired company to create consolidated financial statements.
Comparable Company Analysis (CCA) is one of the most popular financial models used to assess the value of a company using data from other similarly sized businesses in the same industry.Continue reading What is Comparable Company Analysis financial model?
Discounted Cash Flow is a valuation method used by investors to work out the value of an investment which can be either money, assets, companies, etc. based on its future cash flows. Discounted Cash Flow model is one of the most popular financial models that is widely used by business owners and investors.Continue reading What is Discounted Cash Flow (DCF) financial model?
Three Statement Financial model is one of the most popular financial models that is built based on the three financial statements below using data in the past and assumptions for the future to forecast or project the financial position of a company as a whole.Continue reading What is 3-statement financial model? How to build it