Identifying Comparables and Valuation using PB and PE 2.53 Tailored Brands Inc.'s book value of equity is $4.563 million and its forward earnings estimate per share is $1.10, or $55.7 million in total earnings. The following information is also available for TLRD and a peer group of companies (identified by ticker symbol) from the specialty retail sector. EPS 5-Year Debt-to- Market PB Forward Historical ROE Equity Ticker Cap($ mil.) Current PE (FY1) Growth Rate (T 4Q) (Prior Year) TLRD (0.47)% 22.50% GCO 585.7 1.00 9.699 (323.73)% (5.86)% 0.13 ZUMZ 789.7 1.95 14.17 3.28% 13.85% 0.00 GES 1,147.0 2.07 13.19 (37.69)% 1.90% 0.56 ANF 988.2 1.00 19.69 9.37% 6.35% 0.25 TLYS 293.7 1.68 11.6 5.51% 13.93% 0.00 M 4,760.0 0.75 5.458 (1.74)% 16.70% 0.74 (a) Identify a set of three companies from this list to use as comparables for estimating the equity intrinsic value of TLRD using the market multiples approach. (b) Assume that you use as comparables the following set of companies: ZUMZ, TLYS, and M. Estimate TLRD's equity intrinsic value using the PB ratio from these peer companies. (Round average PB ratio to two decimal places for your calculation. Round your answer to the nearest million.) million $ b. Use KLA Tencor Corporation and Lam Research Corporation as comparables, along with the price to NOPAT ratios from part a, and then estimate for Applied Materials its company intrinsic value, its equity intrinsic value, and its equity intrinsic value per share. Round company and equity intrinsic values to the nearest million. Round equity intrinsic value per share to two decimal places. Applied Materials Company intrinsic value $ Equity intrinsic value $ Equity intrinsic value per share $ million million Check Identifying Comparables and Valuation using PB and PE 2.53 Tailored Brands Inc.'s book value of equity is $4.563 million and its forward earnings estimate per share is $1.10, or $55.7 million in total earnings. The following information is also available for TLRD and a peer group of companies (identified by ticker symbol) from the specialty retail sector. EPS 5-Year Debt-to- Market PB Forward Historical ROE Equity Ticker Cap($ mil.) Current PE (FY1) Growth Rate (T 4Q) (Prior Year) TLRD (0.47)% 22.50% GCO 585.7 1.00 9.699 (323.73)% (5.86)% 0.13 ZUMZ 789.7 1.95 14.17 3.28% 13.85% 0.00 GES 1,147.0 2.07 13.19 (37.69)% 1.90% 0.56 ANF 988.2 1.00 19.69 9.37% 6.35% 0.25 TLYS 293.7 1.68 11.6 5.51% 13.93% 0.00 M 4,760.0 0.75 5.458 (1.74)% 16.70% 0.74 (a) Identify a set of three companies from this list to use as comparables for estimating the equity intrinsic value of TLRD using the market multiples approach. (b) Assume that you use as comparables the following set of companies: ZUMZ, TLYS, and M. Estimate TLRD's equity intrinsic value using the PB ratio from these peer companies. (Round average PB ratio to two decimal places for your calculation. Round your answer to the nearest million.) million $ b. Use KLA Tencor Corporation and Lam Research Corporation as comparables, along with the price to NOPAT ratios from part a, and then estimate for Applied Materials its company intrinsic value, its equity intrinsic value, and its equity intrinsic value per share. Round company and equity intrinsic values to the nearest million. Round equity intrinsic value per share to two decimal places. Applied Materials Company intrinsic value $ Equity intrinsic value $ Equity intrinsic value per share $ million million Check
