"So long as one is cognisant of how much of the EV consists of debt..."
Always.
On your point of it being a "sense check", I agree...
...and I don't.
If it's applied, as I have tried to, with a view to future sustainable earnings power, and those "surplus" assets or liabilities (such as debt, surplus cash or any other non-operating asset) are properly viewed in terms of the impact on shareholders pockets, then I believe it's more than a sense check.
In fact it can be just another way of expressing the value of "future cash-flows discounted at an appropriate rate".
On you're final para, I'm not so sure. If a bank borrowed and returned all cash as a div, then to a new buyer the EP (effective price) should go up, as there is now a liability to service and/or to retire.
Whether or not you as a recipient of the div is better or worse off, is another question.
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