Answered step by step
Verified Expert Solution
Question
1 Approved Answer
We want to compute the price of Pabon. It has 2 m shares outstanding and $80 of book value of equity. Pabon expects to sell
We want to compute the price of Pabon. It has 2 m shares outstanding and $80 of book value of equity. Pabon expects to sell $20m worth of sales and have EAT of $5m and keep 40% of its profit. Furthermore, it has $100m of assets. Its short-term assets grew by $13 million and short-term liabilities by $4 million. Moreover, it has depreciation charges of 5% of its assets. Its coe is .12 and its beta is 1.2. Calculate Pabons value.
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