Estimating Share Value Using the ROPI Model Following are forecasts of Texas Roadhouse’s sales, net operating profit after tax (NOPAT), and net operating assets (NOA) as of December 29, 2015.

$ thousands Reported 2015 Forecast Horizon 2016 2017 2018 2019 Sales. . . . . . . . . . . . . . . . $1,807,368 $2,060,400 $2,348,855 $2,513,275 $2,689,205 NOPAT . . . . . . . . . . . . . . 102,495 168,953 192,606 206,089 220,515 NOA . . . . . . . . . . . . . . . . 662,502 755,279 861,017 921,288 985,779 Required

a. Estimate the value of a share of TXRH common stock using the residual operating income (ROPI)

model as of December 29, 2015.

b. TXRH closed at $42.13 on February 26, 2016, the date the Form 10-K was filed with the SEC. How does your valuation estimate compare with this closing price? What do you believe are some reasons for the difference? What investment decision is suggested from your results?