Question
John is trying to evaluate Beta of a private company A using information of a similar public traded company B with Beta 1.5. As debt/asset
John is trying to evaluate Beta of a private company A using information of a similar public traded company B with Beta 1.5. As debt/asset ratio is 20% while Bs debt/asset ratio is 50%. Assuming both company are financed by only debt and equity without preferred stocks, what would be a good estimate of Beta of A?
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The Handbook Of Credit Risk Management
Authors: Sylvain Bouteille, Diane Coogan-Pushner
2nd Edition
1119835631, 978-1119835639
