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b) Assume that you want to estimate a value for Firm Z using comparable M&A transaction data (or enterprise value) and that we have a
b) Assume that you want to estimate a value for Firm Z using comparable M\&A transaction data (or enterprise value) and that we have a set of comparable M\&A transactions based on target firm characteristics like sales, firm age, and products or services as shown in the table below. Considering the series of ratios given from our comparable transactions, calculate an average for each ratio, multiply that average ratio by the appropriate Firm Z financial data and estimate the average share price from the different Firm Z estimates. Firm Z's financial data is $120 in Sales, \$62.5 in Book Value of Equity, and \$7.5 in Net Income. \begin{tabular}{lrlr} Firm Z Data & \multicolumn{1}{c}{S} & Averages & E(Equity) \\ Sales & $120.0 & & \\ BV of Equity & 62.5 & \\ Net Income & 7.5 & \end{tabular} c) Calculate the difference between the two share price estimates and provide a brief description of that difference
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