Watch the previous video on the P/E problem before this one, as it builds off of the hypothetical scenario to provide a valuation solution to the pizzerias with different capital structures. Sal reviews the superficial market capitalization numbers, explaining they could be a better relative valuation metric. He suggests that one must look at a company's enterprise value for a more accurate depiction and illustrates this calculation on balance sheets, separating out nonoperating assets. He also breaks down the formula for EV and then reverses the process by determining stock value from this number. Learners are briefly introduced to EBITDA, but this is covered more in-depth in the following video. Sal applies a six multiple to the operating profit of each pizzeria to find the per-share price.