Share
1,502 Posts.
lightbulb Created with Sketch. 1362
clock Created with Sketch. 13/02/18
16:26
Share
Originally posted by MarsC
↑
I completely agree, with one caveat. Much as I believe an after_tax_EBIT to EV is generally conservative in the case of a business that is net debt, in the case of a business that is net cash, it may not be. Not only will the denominator be reduced to a greater degree than the numerator (usually, and especially in a low interest environment), but mathematically the implication is that the investor acquires the full face value of the excess cash (or whatever the non-operating asset may be) immediately.
Expand
Sure, very fair point.
(20min delay)