Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Pricel Valuel Valuel EBITDA 5.04 Capitalization Value ($ million) ($ million) 6350 10.163 2423 3472 675 3061 1192 14.89 267 1724 18.09 Sales 1.4 1.10
Pricel Valuel Valuel EBITDA 5.04 Capitalization Value ($ million) ($ million) 6350 10.163 2423 3472 675 3061 1192 14.89 267 1724 18.09 Sales 1.4 1.10 1.40 7.21 5.64 PIE Book 7.36 0.73 2.64 9.76 1.68 0.39 6.55 0.82 11.33 1.25 +60% 112% - 40% 69% Gannet New York Times McClatchy Media General 326 Lee Enterprises Average Maximum Minimum 1.31 7.65 1.57 1.35 +16% - 18% 6.65 6.44 +22% - 19% The table above shows the stock prices and multiples for a number of firms in the newspaper publishing industry. Another newspaper publishing firm (not shown) had sales of $620 million, EBITDA of $86 million, excess cash of $61 million, 517 million of debt, and 120 million shares outstanding. If the firm had an EPS of $0.40, what is the difference between the estimated share price of this firm if the average price-earnings ratio is used and the estimated share price if the average enterprise value/EBITDA ratio is used? O A. - $0.45 OB. - $4.50 O C. - $4.95 OD. - $0.27 Click to select your answer. Pricel Valuel Valuel EBITDA 5.04 Capitalization Value ($ million) ($ million) 6350 10.163 2423 3472 675 3061 1192 14.89 267 1724 18.09 Sales 1.4 1.10 1.40 7.21 5.64 PIE Book 7.36 0.73 2.64 9.76 1.68 0.39 6.55 0.82 11.33 1.25 +60% 112% - 40% 69% Gannet New York Times McClatchy Media General 326 Lee Enterprises Average Maximum Minimum 1.31 7.65 1.57 1.35 +16% - 18% 6.65 6.44 +22% - 19% The table above shows the stock prices and multiples for a number of firms in the newspaper publishing industry. Another newspaper publishing firm (not shown) had sales of $620 million, EBITDA of $86 million, excess cash of $61 million, 517 million of debt, and 120 million shares outstanding. If the firm had an EPS of $0.40, what is the difference between the estimated share price of this firm if the average price-earnings ratio is used and the estimated share price if the average enterprise value/EBITDA ratio is used? O A. - $0.45 OB. - $4.50 O C. - $4.95 OD. - $0.27 Click to select your
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started