Calculator · Equity bridge

Equity bridge calculator

Go from the enterprise value of a discounted cash flow to the value of the interest: present values, the bridge to equity, the pro rata share, then DLOC and DLOM in sequence.

How the equity bridge works

The calculator discounts your free cash flows to the firm and a terminal value at the WACC, end-year or mid-year, to an enterprise value. It then adds cash and non-operating assets and deducts debt including leases, preferred shares, minority interests and other claims to reach the equity value (IVS 200 paras 20.07, 120.02 to 120.03 and 130.05).

The equity value is multiplied by the percentage interest, and the discounts for lack of control and of marketability are applied in sequence on the basis you select (IVS 103 para A10.17; IVS 200 paras 60.11 to 60.12), giving a value of the interest and per share. Up to three probability-weighted scenarios, a venture-capital method cross-check and a WACC by growth sensitivity grid are included.

Related: WACC calculator · Terminal value calculator · DLOM calculator · Model notes