Market Value and Enterprise Value are two concepts used to measure the worth of a company. Market Value, or market capitalization, is the current value of all outstanding shares of a company. For example, if a company has 1 million shares of stock and each share is trading at $10, the company’s market value would be $10 million.

Enterprise Value takes into account more than just the market capitalization of a company. It considers both tangible and intangible assets such as cash, debt, and goodwill. By taking these additional factors into account, Enterprise Value provides an accurate reflection of a company’s true worth. Enterprise Value thus serves as a better gauge for potential buyers when evaluating a business.