Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Consider the following data for the airline industry for July 2018 (EV = enterprise value, Book equity book value). Suppose Alaska Air (ALK) has 125
Consider the following data for the airline industry for July 2018 (EV = enterprise value, Book equity book value). Suppose Alaska Air (ALK) has 125 milion shares outstanding. Estimate Alaska Air's share value using each of the five valuation multiples, based on the median valuation multiple of the other seven airlines shown Calculate Alaska Air's share values using each of the five valuation multiples below. (Round the median to two decimal places. Round the share price to the nearest cent. Round the EV and market cap to the nearest Integer.) EV/Sales EVIEBITDA EV/EBIT PIE Alaska Air P/Book 125 1,0 5.1 6,7 7.7 $ Median Implied EV Implied market cap Implied share price $ $ $ $ $ $ $ Enter any number in the edit fields and then continue to the next question Suppose Wesley Publishing's stock has a volatility of 60%, while Addison Printing's stock has a volatility of 25%. If the correlation between these stocks is 65%, what is the volatility of the following portfolios of Addison and Wesley a. 100% Addison b. 75% Addison and 25% Wesley c. 50% Addison and 50% Wesley a. The volatility of a portfolio of 100% Addison stock is % (Round to two decimal places.) b. The volatility of a portfolio of 75% Addison and 25% Wesley is % (Round to two decimal places.) c. The volatility of a portfolio of 50% Addison and 50% Wesley is []%, (Round to two decimal places.) Consider the following data for the airline industry for July 2018 (EV = enterprise value, Book equity book value). Suppose Alaska Air (ALK) has 125 milion shares outstanding. Estimate Alaska Air's share value using each of the five valuation multiples, based on the median valuation multiple of the other seven airlines shown Calculate Alaska Air's share values using each of the five valuation multiples below. (Round the median to two decimal places. Round the share price to the nearest cent. Round the EV and market cap to the nearest Integer.) EV/Sales EVIEBITDA EV/EBIT PIE Alaska Air P/Book 125 1,0 5.1 6,7 7.7 $ Median Implied EV Implied market cap Implied share price $ $ $ $ $ $ $ Enter any number in the edit fields and then continue to the next question Suppose Wesley Publishing's stock has a volatility of 60%, while Addison Printing's stock has a volatility of 25%. If the correlation between these stocks is 65%, what is the volatility of the following portfolios of Addison and Wesley a. 100% Addison b. 75% Addison and 25% Wesley c. 50% Addison and 50% Wesley a. The volatility of a portfolio of 100% Addison stock is % (Round to two decimal places.) b. The volatility of a portfolio of 75% Addison and 25% Wesley is % (Round to two decimal places.) c. The volatility of a portfolio of 50% Addison and 50% Wesley is []%, (Round to two decimal places.)
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access with AI-Powered Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started