Net Income refers to post-tax profit and is also known as net profit. The basic formula for net income is:
- Revenue – All Costs + Interest Income – Interest Expense – Taxation
例如,如果mm的总收入是100美元,齿轮other Operating Expenses are $50mm, there is no interest income or expense and the company pays 35% tax, Net Income would be (100,000,000 – 50,000,000) * (1-0.35) = $32.5mm. Net Income is a measure of profitability but it is not capital-structure neutral (EBITDAis) and it is affected by taxation laws (EBITDAand EBIT are not), so it is less useful for valuation purposes thanEBITDA. For this reason, you very rarely see multiples including Net Income but almost all multiples includeEBITDAin some form. Net Income is found on the Income Statement and Cash Flow Statement.
To learn more about this concept and become a master at Financial Statement modeling, you should check out our FSM Modeling Course.Learn more here.
Module 1: Getting Started
Module 2: Fundamental Concepts
Module 3: The Income Statement
Module 4: Working Capital
Module 5: PP&E and Intangibles
Module 6: The Cash Flow Statement
Module 7: Debt & Interest Schedule
Module 8: Finishing Your Model
Module 9: Bonus
To learn more about this concept and become a master at valuation modeling, you should check out our Valuation Modeling Course.Learn more here.
Module 1: Introduction
Module 2: Valuation: The Big Picture
Module 3: Enterprise Value & Equity Value Practice
Module 4: Trading Comparables Introduction
Module 5: Trading Comps: The Setup
Module 6: Trading Comps: Spreading Nike (NKE)
Module 7: Trading Comps: Spreading Adidas (ADS.DE)
Module 8: Trading Comps: Spreading Lululemon (LULU)
Module 9: Trading Comps: Spreading Under Armour (UA)
Module 10: Trading Comps: Benchmarking and Outputs
Module 11: Precedent Transactions: Introduction
Module 12: Precedents: The Setup
Module 13: Spreading Tiffany & LVMH
Module 14: Spreading FitBit & Google
Module 15: Spreading Reebok & Adidas
Module 16: Spreading Jimmy Choo & Michael Kors
Module 17: Spreading Dickies & VF
Module 18: Valuation Wrap-Up
Module 19: Bonus: Non-GAAP Practice
Related Terms
- Amortization
- Capital Structure
- Cash Flow Statement (CFS)
- Cost of Goods Sold (COGS)
- Depreciation
- 利息及税项(EBIT)
- Earnings Before Interest, Taxation, Depreciation & Amortization (EBITDA)
- Interest Expense
- Interest Income
- Income Statement (IS)
- Operating Expenses
- Revenue
- Stock-Based Compensation
- Taxation
- Trading Multiple
- Valuation
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