Series 79 Formulas

Current Yield

Annual Interest / Market Price

Conversion Ratio

Par Value / Conversion Price

Parity Price of a Bond

MV (Stock) x Conversion Ratio

Parity Price of a Stock

MV (Bond) / Conversion Ratio

Equity Value

Total Shares Outstanding x Stock Price

= Enterprise Value - Debt + Cash

Enterprise Value

Equity Value + Debt + Preferred Stock + Noncontrolling Interest - Cash

= Equity Value + Debt - Cash

Net Debt

Total Debt - Cash

Gross Profit Margin

Gross Profit / Sales

EBITDA Margin

EBITDA / Sales

Operating Margin

EBIT / Sales

Net Profit Margin

Net Income / Sales

Balance Sheet Formula

Assets = Liabilities + Shareholders Equity

Total Debt

Loans + Bonds + Notes + Debentures + Capital Leases + Short Term Debt + Current Maturities of Long-term Debt

Last Twelve Months (LTM)

YTD Results + Previous Years Results - Prior YTD (i.e. Stub)

Basic Earnings Per Share (EPS)

Net Income / Reported Shares Outstanding

Diluted EPS

Net Income / Diluted Shares Outstanding

Price-to-Earnings (P/E)

Stock Price / Earnings Per Share

= Equity Value / Net Income

Price-to-Earnings Growth (PEG Ratio)

(P/E) / Annual Growth Rate

Price-to-Book Value (P/B)

Equity Value / Book Value of Equity

Price-to-Tangible Book Value

Equity Value / (Book Value of Equity - Goodwill)

Dividend Yield

Annual Dividend / Stock Price

Dividend Payout Ratio

Annual Dividend / Reported EPS

Earnings Yield

EPS / Stock Price

= 1 / (P/E Ratio)

Enterprise Value to Sales

Enterprise Value / Sales

Enterprise Value to EBITDA

Enterprise Value / EBITDA

Enterprise Value to EBIT

Enterprise Value / EBIT

Interest Coverage Ratio

Adj. EBITDA / Interest Expense

Debt-to-EBITDA

Total Debt / Adj. EBITDA

Net Debt-to-EBITDA

Net Debt / Adj. EBITDA

Debt-to-Capitalization

Total Debt / (Total Debt + Book Equity)

Invested Capital

Average Equity + Average Net Debt

Return on Assets (ROA)

Net Income / Average Assets

Return on Equity (ROE)

Net Income / Average Shareholders' Equity

Return on Invested Capital (ROIC)

Adj. EBIT / Invested Capital

= EBITA / Invested Capital

Return on Capital (ROC)

Net Income / Invested Capital

Working Capital

Current Assets - Current Liabilities

Accounts Receivable Turnover

Sales / Average Accounts Receivable

Days Sales Outstanding (DSO)

(Average Accounts Receivable / Sales) x 365

Inventory Turnover

COGS / Average Inventory

Days Inventory Held (DIH)

(Average Inventory / COGS) x 365

Accounts Payable Turnover

COGS / Average Accounts Payable

Days Payable Outstanding (DPO)

(Average Accounts Payable / COGS) x 365

Current Ratio

Current Assets / Current Liabilities

Quick Ratio (Acid Test Ratio)

(Current Assets - Inventory) / Current Liabilities

Implied Enterprise Value

Sales x (EV / Sales)

= EBITDA x (EV / EBITDA)

= EBIT x (EV / EBIT)

Implied Equity Value

Net Income x P/E Multiple

Implied Stock Price

EPS x P/E Multiple

Weighted Average Cost of Capital (WACC)

[After-tax Cost of Debt x (Debt / {Debt + Equity})] + [Cost of Equity (Equity / {Debt + Equity})]

Cost of Debt

Current Yield x (1 - Tax Rate)

= (Annual Interest / Market Price) x (1 - t)

Cost of Equity (CAPM)

Risk-free Rate + Beta (Market Risk Premium)

= Risk-free + B (Market return - Risk-free)

Unlevered Free Cash Flow

EBIAT + D&A + CAPEX - Increase in Net Working Capital

Exchange Ratio

(Offer Price Per Share - Cash Per Share) / Stock Price of Acquirer Co