The average EV/EBITDA ratio of the competitor firms to Jorge's Junk Removal is 6.5. Jorge's Junk...
The average EV/EBITDA ratio of the competitor firms to Jorge's Junk Removal is 6.5. Jorge's Junk Removal has an EBIT of $400 million, depreciation of $100 million, no amortization expense, $500 million in debt, $40 million in cash, and 25 million outstanding shares. What should the price of a share of Jorge's Junk Removal be?
A) $59.60
B) $131.60
C) $32.50
D) $85.60
E) $111.60
Homework Answers
EBIDTA = EBIT+depr = 400+100 = 500
EV = EBIDTA*EV/EBIDTA = 500*6.5 = 3250
| Enterprise value = Equity value+ MV of debt |
| - Cash & Cash Equivalents |
| 3250 = Equity value+500-40 |
| Equity value = 2790 |
| share price = equity value/number of shares |
| share price = 2790/25 |
| share price = 111.6 |
Add Answer to:
The average EV/EBITDA ratio of the
competitor firms to Jorge's Junk Removal is 6.5. Jorge's Junk...
CSH has EBITDA of $ 6 million. You feel that an appropriate EV/EBITDA ratio for CSH...
CSH has EBITDA of $ 6 million. You feel that an appropriate EV/EBITDA ratio for CSH is 10. CSH has $ 6 million in debt, $ 2 million in cash, and 775,000 shares outstanding. What is your estimate of CSH's stock price?
CSH has EBITDA of $ 5 million. You feel that an appropriate EV/EBITDA ratio for CSH...
CSH has EBITDA of $ 5 million. You feel that an appropriate EV/EBITDA ratio for CSH is 99. CSH has $ 10 million in debt, $ 2 million in cash, and 800,000 shares outstanding. What is your estimate of CSH's stock price?
CSH has EBITDA of $5 million. You feel that an appropriate EV/EBITDA ratio for CSH is...
CSH has EBITDA of $5 million. You feel that an appropriate EV/EBITDA ratio for CSH is 10. CSH has $7 million in debt, $4 million in cash, and 750,000 shares outstanding. What is your estimate of CSH's stock price? The estimate of CSH's stock price is . (Round to the nearest cent.)
CSH has EBITDA of $4 million. You feel that an appropriate EV/EBITDA ratio for CSH is...
CSH has EBITDA of $4 million. You feel that an appropriate EV/EBITDA ratio for CSH is 7. CSH has $6 million in debt,$4 million in cash, and 775,000 shares outstanding. What is your estimate of CSH's stock price? The estimate of CSH's stock price is? (Round to the nearest cent.)
10. Problem 4.10 (M-B, SHARE PRICE, and EV-EBITDA) You are given the following information: Stockholders' equity...
10. Problem 4.10 (M-B, SHARE PRICE, and EV-EBITDA) You are given the following information: Stockholders' equity as reported on the firm's balance sheet = $3.25 billion, price/earnings ratio = 22, common shares outstanding = 180 million, and market/book ratio = 1.6. The firm's market value of total debt is $6 billion, the firm has cash and equivalents totaling $250 million, and the firm's EBITDA equals $1 billion. What is the price of a share of the company's common stock? Do not...
Please show any and all work or sub-calculations. A firm's EV / EBITDA ratio has most...
Please show any and all work or sub-calculations.
A firm's EV / EBITDA ratio has most recently (2018) been 7.8 but has grown as indicated in the below table since 2014. EBITDA over that same timeframe is given in the table also. An analyst wants to estimate the target price of the stock one year in the future. The analyst estimates the company's LT Debt in one year to be $1,400,000 and cash at $75,000. If 50,000 shares of stock...
1. Assume EBITDA is 10, EBIT is 8, EBT is 6.5 and the Net Income is...
1. Assume EBITDA is 10, EBIT is 8, EBT is 6.5 and the Net Income is 4. What is Times Interest Earned? A. 3.2x B. 1.5x C. 5.3x D. 8x 2. Assume that Net Income is $5 million, Common Shares outstanding is $2 million, Accumulated Retained Earnings is $4 million, and the Market Price per share of Common Stock is $20. What is the Price/Earning Ratio? A. 4.0 B. 6.4 C. 8.0 D. 4.4 3. Consider the following information: Ratio__________________________2013_____2014_____2015_____Industry...
XYZ Corporation has $200M in debt that yields 8%, its stock trades at $20/share and there...
XYZ Corporation has $200M in debt that yields 8%, its stock trades at $20/share and there are 20M shares outstanding. The book value of equity is $300M. XYZ's beta is 1.3. The risk free rate is 3.0% and the the market risk premium is 6%. Their EBIT was $100M. They had $50M of Depreciation (no Amortization), $20M of interest expense and taxes of $20M. Assume that tax rates will be the same in the future as they have been in...
2. a. What are the determinants of Price-to-book ratio? (10 marks) b. Conglomerate Inc. is a...
2. a. What are the determinants of Price-to-book ratio? (10 marks) b. Conglomerate Inc. is a company in three different businesses and its performance in each business for the most recent year is as follows (all figures are $ million). Interest Net income EBITDA 50 Business Steel Technology Financial Services Revenue 1,000 500 200 50 5 30 10 10 The company has $200 million in debt outstanding and no cash balance. The interest expense is allocated to each of the...
An analyst has gathered the following data for Sure Money Inc (SMI): Recent share price $31.25...
An analyst has gathered the following data for Sure Money Inc (SMI): Recent share price $31.25 Shares outstanding 30 million Market value of debt $115 million Cash and marketable securities $47.6 million Investments $247 million Net income $119.4 million . Interest expense $5.8 million • Depreciation $6.9 million Amortization $2.3 million • Taxes $85.9 million The EV/EBITDA ratio for SMI is closest to Select one: O a. 2.62 b. 5.26 C. 3.44 d. 4.78
CSH has EBITDA of $5 million. You feel that an appropriate EV/EBITDA ratio for CSH is 10. CSH has $7 million in debt, $4 million in cash, and 750,000 shares outstanding. What is your estimate of CSH's stock price? The estimate of CSH's stock price is . (Round to the nearest cent.)
10. Problem 4.10 (M-B, SHARE PRICE, and EV-EBITDA) You are given the following information: Stockholders' equity as reported on the firm's balance sheet = $3.25 billion, price/earnings ratio = 22, common shares outstanding = 180 million, and market/book ratio = 1.6. The firm's market value of total debt is $6 billion, the firm has cash and equivalents totaling $250 million, and the firm's EBITDA equals $1 billion. What is the price of a share of the company's common stock? Do not...
Please show any and all work or sub-calculations.
A firm's EV / EBITDA ratio has most recently (2018) been 7.8 but has grown as indicated in the below table since 2014. EBITDA over that same timeframe is given in the table also. An analyst wants to estimate the target price of the stock one year in the future. The analyst estimates the company's LT Debt in one year to be $1,400,000 and cash at $75,000. If 50,000 shares of stock...
XYZ Corporation has $200M in debt that yields 8%, its stock trades at $20/share and there are 20M shares outstanding. The book value of equity is $300M. XYZ's beta is 1.3. The risk free rate is 3.0% and the the market risk premium is 6%. Their EBIT was $100M. They had $50M of Depreciation (no Amortization), $20M of interest expense and taxes of $20M. Assume that tax rates will be the same in the future as they have been in...
2. a. What are the determinants of Price-to-book ratio? (10 marks) b. Conglomerate Inc. is a company in three different businesses and its performance in each business for the most recent year is as follows (all figures are $ million). Interest Net income EBITDA 50 Business Steel Technology Financial Services Revenue 1,000 500 200 50 5 30 10 10 The company has $200 million in debt outstanding and no cash balance. The interest expense is allocated to each of the...
An analyst has gathered the following data for Sure Money Inc (SMI): Recent share price $31.25 Shares outstanding 30 million Market value of debt $115 million Cash and marketable securities $47.6 million Investments $247 million Net income $119.4 million . Interest expense $5.8 million • Depreciation $6.9 million Amortization $2.3 million • Taxes $85.9 million The EV/EBITDA ratio for SMI is closest to Select one: O a. 2.62 b. 5.26 C. 3.44 d. 4.78
Most questions answered within 3 hours.
-
Suppose you just bought the new Windoze 8 and that you realize
that it really sucks....
asked 1 minute ago -
The vapor pressure of water at 20°C is 17.54 torr. Calculate the
vapor pressure (in torr)...
asked 7 minutes ago -
Hi,
can someone please explain to me the time complexity of an
algorithm specially big O...
asked 7 minutes ago -
Python
Prompt the
user to enter a step size to step down by. Write a while
loop...
asked 7 minutes ago -
Demonstrate the power of the Containment Theory of Walter
Reckless with regard to the idea of...
asked 19 minutes ago -
Case 3: New Retail Strategy
September 2010: American retailers are cutting expenses to
maintain stable profits...
asked 29 minutes ago -
What do you expect to happen when acetylacetone reacts with a
base? Draw structures of the...
asked 28 minutes ago -
What is meant by biocultural evolution? what examples will
better describe how it might have influenced...
asked 1 hour ago -
How
do I locate proper sources that are peer reviewed articles for this
topic : placing...
asked 58 minutes ago -
A recent graduate decided to have $1 million ready for
retirement 30 years from now. The...
asked 56 minutes ago -
Schrute Farm Sales buys portable generators for $460 and sells
them for $720 He pays a...
asked 1 hour ago -
A 10,000 kg jet plane must reach a speed of 60 m / s for
takeoff....
asked 58 minutes ago