Equity value is the value of a company available to owners or shareholders.
It is the enterprise value plus all cash and cash equivalents, short and long-term investments, and less all short-term debt, long-term debt and minority interests.
[1][2] Equity value accounts for all the ownership interest in a firm including the value of unexercised stock options and securities convertible to equity.
From a mergers and acquisitions to an academic perspective, equity value differs from market capitalization or market value in that it incorporates all equity interests in a firm whereas market capitalization or market value only reflects those common shares currently outstanding.
The intrinsic value method is calculated as follows: The fair market value method is as follows: The fair market value method more accurately captures the value of out of the money securities.