Question
1. Consider a company which had revenues of $28 million over the last twelve months. Depreciation and amortization expenses were $7 million. Operating margin was
1. Consider a company which had revenues of $28 million over the last twelve months. Depreciation and amortization expenses were $7 million. Operating margin was 25.6%. It has $29 million of debt, $3 million in cash, and 12 million shares outstanding. Comparable companies are trading at an average trailing EV/EBITDA multiple of 18. How much is each share worth using relative valuation? Round to one decimal place.
2. A company had total revenues of $56 million, operating margin of 26.8%, and depreciation and amortization expense of $24 million over the trailing twelve months. The company currently has $220 million in total debt and $37 million in cash and cash equivalents. The company's shares are currently trading at $31.7 per share and there are 11 million shares outstanding. What is its EV/EBITDA ratio? Round to one decimal place.
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