Suppose that in January 2006 Kenneth Cole Productions had sales of

$ 524$524

million, EBITDA of

$ 56.9$56.9

million, excess cash of

$ 108$108

million,

$ 6.2$6.2

million of debt, and

1818

million shares outstanding. Use the multiples approach to estimate KCP's value based on the following data from comparable firms:

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.

a. Using the average enterprise value to sales multiple in the table above, estimate KCP's share price.

b. What range of share prices do you estimate based on the highest and lowest enterprise value to sales multiples in the table above.

c. Using the average enterprise value to EBITDA multiple in the table above, estimate KCP's share price.

d. What range of share prices do you estimate based on the highest and lowest enterprise value to EBITDA multiples in the table above?

Click

on the Icon located on the top-right corner of the data table below in order to copy its contents into a

spreadsheet.)

	StartFraction Upper P Over Upper E EndFractionPE	StartFraction Price Over Book EndFractionPriceBook	StartFraction Enterprise Value Over Sales EndFractionEnterprise ValueSales	StartFraction Enterprise Value Over EBITDA EndFractionEnterprise ValueEBITDA
Average	15.01	2.84	1.06	8.49
Maximum	+51%	+186%	+106%	plus 27 %+27%
Minimum	negative 42 %42%	negative 61 %61%	negative 56 %56%	negative 22 %22%