Question 19

Use the following target company and comparable multiples to estimate a takeover value if P/CF is weighted 40%, and each of the other multiples are weighted 20%.

Target Co Average of comparable transactions

Earnings $2 million P/E = 45 times

Cash flow $5 million P/CF = 22 times

Book value of equity $50 million P/BV = 2 times

Sales $100 million P/S = 1 times

		$100 million
		$122.4 million
		$102 million
		$90 million