Skip to main content
All CollectionsValerStep 2: Input Financials - Creating Your Financial Projections
Why doesn’t Valer ask for the company’s net income?
Why doesn’t Valer ask for the company’s net income?

Valuation | Financials

Wendy Canady avatar
Written by Wendy Canady
Updated over 2 years ago

Valer calculates company valuations on an enterprise value basis to avoid distortions resulting from capital structure differences between companies and to avoid questionable assumptions about future financing costs. Accordingly, net income is not used in the current version of Valer.

Instead, implied equity values are calculated indirectly, by subtracting net debt from implied enterprise values derived using the three methodologies.

Did this answer your question?