(B)
Enterprises Value =EV/EBITDA * EBITDA
Enterprises Value = 10 * (14 + 8%*14)
Enterprises Value = $151.2 Million
Maximum share price that Happy Times = (Enterprises Value-debt) /No of outstanding share
Maximum share price that Happy Times = 151.2 / 2.25
Maximum share price that Happy Times = $ 67.2
If there is any doubt please ask in comments
Happy Times, Inc., wants to expand its party stores into the Southeast. In order to establish...
Happy Times, Inc., wants to expand its party stores into the Southeast. In order to establish an immediate presence in the area, the company is considering the purchase of the privately held Joe's Party Supply. Happy Times currently has debt outstanding with a market value of $200 million and a YTM of 6 percent. The company's market capitalization is $440 million and the required return on equity is 11 percent. Joe's currently has debt outstanding with a market value of...
Happy Times, Inc., wants to expand its party stores into the Southeast. In order to establish an immediate presence in the area, the company is considering the purchase of the privately held Joe's Party Supply. Happy Times currently has debt outstanding with a market value of $150 million and a YTM of 5 percent. The company's market capitalization is $390 million and the required return on equity is 10 percent. Joe's currently has debt outstanding with a market value of...
Happy Times, Inc., wants to expand its party stores into the Southeast. In order to establish an immediate presence in the area, the company is considering the purchase of the privately held Joe's Party Supply. Happy Times currently has debt outstanding with a market value of $220 million and a YTM of 7 percent. The company's market capitalization is $460 million, and the required return on equity is 12 percent. Joe's currently has debt outstanding with a market value of...
Happy Times, Inc., wants to expand its party stores into the Southeast. In order to establish an immediate presence in the area, the company is considering the purchase of the privately held Joe’s Party Supply. Happy Times currently has debt outstanding with a market value of $160 million and a YTM of 7 percent. The company’s market capitalization is $400 million, and the required return on equity is 12 percent. Joe’s currently has debt outstanding with a market value of...
Happy Times, Inc., wants to expand its party stores into the Southeast. In order to establish an immediate presence in the area, the company is considering the purchase of the privately held Joe’s Party Supply. Happy Times currently has debt outstanding with a market value of $120 million and a YTM of 6 percent. The company’s market capitalization is $340 million, and the required return on equity is 11 percent. Joe’s currently has debt outstanding with a market value of...
Happy Times, Inc., wants to expand its party stores into the Southeast. In order to establish an immediate presence in the area, the company is considering the purchase of the privately held Joe’s Party Supply. Happy Times currently has debt outstanding with a market value of $200 million and a YTM of 6 percent. The company’s market capitalization is $440 million, and the required return on equity is 11 percent. Joe’s currently has debt outstanding with a market value of...
Happy Times, Inc., wants to expand its party stores into the Southeast. In order to establish an immediate presence in the area, the company is considering the purchase of the privately held Joe’s Party Supply. Happy Times currently has debt outstanding with a market value of $220 million and a YTM of 9 percent. The company’s market capitalization is $300 million, and the required return on equity is 14 percent. Joe’s currently has debt outstanding with a market value of...
Problem 1 (15 points) Happy Times, Inc., wants to expand its party stores into the Southeast. In order to establish an mediate presence in the area, the company is considering the purchase of the privately held Joe's Party Supply. Happy Times currently has debt outstanding with a market value &$105 million and a YIM of 6 percent. The company's market capitalization is $285 million and the required return on equity is 11 percent. Joe's currently has debt outstanding with a...
Problem 12-21 Firm Valuation Happy Times, Inc., wants to expand its party stores into the Southeast. In order to establish an immediate presence in the area, the company is considering the purchase of the privately held Joe’s Party Supply. Happy Times currently has debt outstanding with a market value of $200 million and a YTM of 6 percent. The company’s market capitalization is $440 million, and the required return on equity is 11 percent. Joe’s currently has debt outstanding with...
FFDP Corp. has yearly sales of $29.6 million and costs of $15.1 million. The company’s balance sheet shows debt of $55.6 million and cash of $39.6 million. There are 1,960,000 shares outstanding and the industry EV/EBITDA multiple is 9.1. What is the company’s enterprise value? (Do not round intermediate calculations and enter your answer in dollars, not millions of dollars, rounded to the nearest whole number, e.g., 1,234,567.) What is the stock price per share? (Do not round intermediate calculations...