Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Following are the income statement and balance sheet for Texas Roadhouse for the year ended December 29, 2015. Assume the following forecasts for TXRH's sales,

image text in transcribed

Following are the income statement and balance sheet for Texas Roadhouse for the year ended December 29, 2015. Assume the following forecasts for TXRH's sales, NOPAT, and NOA for 2016 through 2019. Forecast the terminal period values assuming a 196 terminal period growth rate for all three model inputs: Sales, NOPAT, and NOA. Round your answers to the nearest dollar Terminal Reported $ thousands 2015 2016 2017 2018 2019 Period 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 861017 921,288 985,779 a. Estimate the value of a share of TXRH common stock using the residual operating income (ROPI) model as of December 29, 2015; assume a discount rate (WACC) of 7%, common shares outstanding of 70,091 thousand, net nonoperating obligations (NNO) of $(14,680) thousand, and noncontrolling interest (NCI) from the balance sheet of $7,520 thousand. Note that NNO is negative because the company's cash exceeds its nonoperating liabilities. Rounding instructions: .Use rounded answers for subsequent computations. . Round answers to the nearest whole number unless otherwise noted . Round discount factor to 5 decimal places and stock price per share to two decimal places. Do not use negative signs with any of your answers below TXRH Reported Terminal Period $ thousands 2015 2018 2019 ROPI (NOPAT-[NOABeg 124,801 S Discount factor [1/(1+ rw)t] Present value of horizon ROPI Present value of terminal ROPI NOA Total firm value NNO

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

More Books

Students also viewed these Accounting questions

Question

Employ effective vocal cues Employ effective visual cues

Answered: 1 week ago