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How do I calculate Market value of equity from financial report.

  • 03-03-2011 7:31am
    #1
    Alidee
    Registered Users, Registered Users 2 Posts: 109 ✭✭


    Long story. Am new to accountancy, and assignment to be done. Want to calculate Altman Z Score. One of the ratios is this one:

    Market Value of Equity / Total Liabilities


    How do I know Market Value of Equity???? The financial report lists the share capital, equity and preference shares, and 5.5% cumulative preference shares of €1.269738 each etc, but here is where it's all new to me. There are authorised, and allotted, called up and fully paid shares etc. How do I know the Market value of equity for the equation. I know the earnings per share is 34 cent.

    All advice appreciated, to get this assignment done. Its a small module of a much longer course, but I would like to get my head around it, please and thanks for your help.


Comments

  • #2
    SBWife
    Registered Users, Registered Users 2 Posts: 1,287 ✭✭✭SBWife


    Market Value of Common = Number of Common Shares Outstanding x Market Price


  • #3
    sankari
    Closed Accounts Posts: 7 ✭sankari


    Market value equity is another term of "Market Capitalization", that specifies the total cash value of the outstanding shares in a company.
    - Find the company's total number of outstanding shares.
    - Find the current price of company's stock.
    - Finally, to calculate the market value of equity multiply the number of outstanding shares by the price of the stock.



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