See Table 2.5 showing financial statement data and stock price data for Mydeco Corp.

1. What is Mydecos market capitalization at the end of each year?
2. What is Mydecos market-to-book ratio at the end of each year?
3. What is Mydecos enterprise value at the end of each year?
4. By what percentage did Mydecos revenues grow each year from 2010 to 2013?
5. By what percentage did net income grow each year?
6. Why might the growth rates of revenues and net income differ?
7. Suppose Mydeco repurchases 2 million shares each year from 2010 to 2013. What would its earnings per share be in years 20102013? (Assume Mydeco pays for the shares using its available cash and that Mydeco earns no interest on its cash balances.)
8. Suppose Mydeco had purchased additional equipment for $12 million at the end of 2010, and this equipment was depreciated by $4 million per year in 2011, 2012, and 2013. Given Mydecos tax rate of 35%, what impact would this additional purchase have had on Mydecos net income in years 20102013? (Assume the equipment is paid for out of cash and that Mydeco earns no interest on its cash balances.)
9. Suppose Mydecos costs and expenses had been the same fraction of revenues in 20102013 as they were in 2009. What would Mydecos EPS have been each year in this case?
10. What were Mydecos retained earnings each year?
11. Using the data from 2009, what was Mydecos total stockholders equity in 2008?

Problems 53 TABLE 2.5 2009-2013 Financial Statement Data and Stock Price Data for Mydeco Corp. (All data as of fiscal year end; in $ million) 2009 2010 2011 2012 2013 404.3 363.8 424.6 510. 7 6 04.1 (188.3) (173.8) (206.2) (246.8) (293.4) 216.0 190.0 218.4 263.9 310.7 (66.7) (66.4) (82.8) (102.1) (120.8) (60.6) (59.1) (59.4) (66.4) (78.5) (27.3) (27.0) (34.3) (38.4) (38.6) 61.4 37.5 41.9 57.0 72.8 (33.7) (32.9) (32.2) (37.4) (39.4) 27.7 4.6 9.7 19.6 33.4 (9.7) (1.6) (3.4) (6.9) (11.7) 18.0 3.0 6.3 12.7 21.7 55.0 55.0 55.0 55.0 $0.33 $0.05 $0.11 $0.23 $0.39 2009 2010 2011 2012 2013 55.0 68.9 77.5 48.8 88.6 33.7 171.1 245.3 361.7 778.1 69.8 30.9 169.6 243.3 361.7 774.6 86.3 69.8 28.4 184.5 309 361.7 855.2 76.9 31.7 186.1 345.6 361.7 893.4 85.0 86.1 35.3 206.4 347.0 361.7 915.1 Mydeco Corp. 2009-2013 Income Statement Revenue Cost of Goods Sold Gross Profit Sales and Marketing Administration Depreciation & Amortization EBIT Interest Income (Expense) Pretax Income Income Tax Net Income Shares outstanding (millions) Earnings per share Balance Sheet Assets Cash Accounts Receivable Inventory Total Current Assets Net Property, Plant & Equip. Goodwill & Intangibles Total Assets Liabilities Stockholders' Equity Accounts Payable Accrued Compensation Total Current Liabilities Long-term Debt Total Liabilities Stockholders' Equity Total Liabilities & Stockholders' Equity Statement of Cash Flows Net Income Depreciation & Amortization Chg. in Accounts Receivable Chg. in Inventory Chg. in Payables & Accrued Comp. Cash from Operations Capital Expenditures Cash from Investing Activities Dividends Paid Sale (or purchase) of stock Debt Issuance (Pay Down) Cash from Financing Activities Change in Cash Mydeco Stock Price 18.7 6.7 25.4 500.0 525.4 252.7 778.1 17.9 6.4 24.3 500.0 524.3 250.3 774.6 22.0 7.0 29.0 575.0 604.0 251.2 855.2 26.8 8.1 34.9 600.0 634.9 258.5 893.4 31.7 9.7 41.4 600.0 641.4 273.7 915.1 2010 3.0 2009 18.0 27.3 3.9 (2.9) 2.2 2011 6.3 34.3 (0.0) 2.5 27.0 18.8 2.8 (1.1) 50.5 (25.0) (25.0) (5.4) 2012 12.7 38.4 (7.1) (3.3) 5.9 46.6 (75.0) (75.0) (5.4) 2013 21.7 38.6 (9.2) (3.6) 6.5 54.0 (40.0) (40.0) (6.5) 48.5 (25.0) (25.0) (5.4) 4.7 47.8 (100.0) (100.0) (5.4) (5.4) 18.1 $7.92 (5.4) 20.1 $3.30 75.0 69.6 17.4 $5.25 25.0 19.6 (8.8) $8.71 7.5 $10.89