Consider the following data for the airline industry for December 2015 (EV = enterprise value, Book =
Question:
Consider the following data for the airline industry for December 2015 (EV = enterprise value, Book = tangible book value). Discuss the challenges of using multiples to value an airline.
Transcribed Image Text:
Com pany Na me Delta Air Lines (DAL American Airines(AAL United Continental (UAL South west Airlines (LUV Alaska Air (ALK etBlue Airways (JBLU SkyWest (SKYw) Market Cap 40,857 27,249 22,000 2B 499 10,396 7,338 1,039 1,974 EV 45,846 38,937 28,522 28,125 9,870 8,189 2,590 2,281 EV/Sales EV/EBITDA EV/EBIT 5.0x 4.5x 4.2x 5.0x 6.3x 5.1x 5.2x 5.3x 1.1x 0.9x 0.7x 1.5x 1.Ex 1.3x 0.8x 1.0x 7.6x 5.5x 5.6x 7.4x 7.9x 7.9x 11.1x 6.9 P/E 15.0x 6.2x 3.4x 16.1x 13.4x 13.8x 21.2x 15.1x P/Book 4.0x 7.5x 2.6x 4.1x 4.4x 2.4x 0.7x 5.3x Source: Capital Q and Yahoo Finance
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Answer rating: 71% (7 reviews)
Given Data Company Name Market Cap EV EVSales EVEBITDA EVEBIT PE PBook De...View the full answer
Answered By
S Mwaura
A quality-driven writer with special technical skills and vast experience in various disciplines. A plagiarism-free paper and impeccable quality content are what I deliver. Timely delivery and originality are guaranteed. Kindly allow me to do any work for you and I guarantee you an A-worthy paper.
4.80+
27+ Reviews
73+ Question Solved
Related Book For
Question Posted:
Students also viewed these Corporate Finance questions
-
Consider the following data for the Rivera Company: From the above information, fill in the blanks below. Be sure to mark your variances F for favorable and U forunfavorable. Factory Overhead Fixed...
-
Consider the following data for a manufacturer: Requirement 1. Compute cost of goods manufactured and cost of goodssold. End of Year Beginning of Year Direct materials inventory Work in process...
-
Consider the following data for a one-factor economy. All portfolios are well diversified. Suppose that another portfolio, portfolio E, is well diversified with a beta of .6 and expected return of...
-
Not sure if this note is applicable to the problem? (A2) Prove there is a bijection between any two countably infinite sets.
-
The following table shows the revenues and average net fixed assets for a recent fiscal year for three different companies from three different industries: retailing, manufacturing, and...
-
Condensed financial data of Cadet Company are shown below. Additional information:1. New plant assets costing $151,000 were purchased for cash during the year.2. Investments were sold at cost.3....
-
The light ray in Figure P24.2 emanates from a point on one wall of a room and is incident on a plane mirror that lies flat on the opposite wall. The reflected ray strikes the lefthand wall at point...
-
The following selected transactions relate to investment activities of Ornamental Insulation Corporation during 2018. The company buys debt securities, intending to profit from short-term differences...
-
The Morning Jolt Coffee Company has projected the following quarterly sales amounts for the coming year: Q1 Q2 Q3 Q4 Sales $ 790 $ 820 $ 900 $ 980 a. Accounts receivable at the beginning of the year...
-
Lidge Company of Texas (TX) is classified as a monthly depositor and pays its employees monthly. The following payroll information is for the second quarter of 2 WITHHOLDINGS Wages $86,100 92,500...
-
Consider the valuation of Kenneth Cole Productions in Example 9.7. a. Suppose you believe KCP's initial revenue growth rate will be between 4% and 11% (with growth slowing in equal steps to 4% by...
-
Suppose Hawaiian Airlines (HA) has 53 million shares outstanding. Estimate Hawaiian's share value using each of the five valuation multiples in Problem 28, based on the median valuation multiple of...
-
What is the half-life of a radioisotope if it decays to 12.5% of its radioactivity in 12 years?
-
The State of Confusion Legislature passes the following statute: "The State Health Commissioner, when in their opinion, there is sufficient covid - 1 9 vaccine that has been approved by the Federal...
-
Case 1 Baum Co. has two processing departments: Fabrication and Assembly. In the Fabrication Department, metal is cut and formed into various components, which are then transferred to Assembly. The...
-
Your earlier Personal Leadership Assessment, you looked at two areas of your leadership experience, those who led you and those you led. You will again address these two items in your Personal...
-
What is required in this situation: Content slides explaining the qualitative and quantitative steps necessary in conducting a sensitivity analysis. How can a project's risk be incorporated into a...
-
What is "marketing"? What is the difference between "marketing" and the "marketing process"?is it different in your home country vs. North america? Q2. What is the difference between "demand",...
-
What is the highest oxidation state that antimony can have in its compounds? (a) 0 (b) +1 (c) +3 (d) +5
-
On January 1, 2017, McIlroy, Inc., acquired a 60 percent interest in the common stock of Stinson, Inc., for $340,200. Stinson's book value on that date consisted of common stock of $100,000 and...
-
Buhler Industries is a farm implement manufacturer. Management is currently evaluating a proposal to build a plant that will manufacture lightweight tractors. Buhler plans to use a cost of capital of...
-
Buckingham Packaging is considering expanding its production capacity by purchasing a new machine, the XC-750. The cost of the XC-750 is $2.75 million. Unfortunately, installing this machine will...
-
Royal Mount Games would like to invest in a division to develop software for video games. To evaluate this decision, the firm first attempts to project the working capital needs for this operation....
-
Suppose the S&P 500 currently has a level of 960. One contract of S&P 500 index futures has a size of $250 S&P 500 index. You wish to hedge an $800,000-portfolio that has a beta of 1.2. (A)In order...
-
Exhibit 4.1 The balance sheet and income statement shown below are for Koski Inc. Note that the firm has no amortization charges, it does not lease any assets, none of its debt must be retired during...
-
Haley is 57 years of age. She is planning for future long-term care needs. She knows that yearly nursing home costs in her area are currently $69,000, with prices increased by 5 percent annually....
Study smarter with the SolutionInn App