Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

You are attempting the value a company that you would like to purchase. You have conducted the below comparable company analysis to guide your decision.

You are attempting the value a company that you would like to purchase. You have conducted the below comparable company analysis to guide your decision. Using the below analysis, please answer Questions 7 & 8.image text in transcribed

1. Based on actual 2010 comparable company data, what is the highest multiple of EBITDA that you should pay to purchase the target company?

2. Based on actual 2010 comparable company data, what is the midpoint multiple of EBITDA that you should pay to purchase the target company?

Comparable Compary Analysis EVEBITDA Summary P/E Mkt Cap 2010A Price Shares EV 2011E 2012E 2010A 2011E 2012E Company Comps Company A Company B Company C Company D Company E Company F Company G Company H Company $16.95 60.2 $1,032 $1,805 $9,257 $19,074 $2,635 13.6x 11.7x 10.9x 4.4x 3. 8 3.7x 1,730.2 $5.26 15.8x 15.2x 14.5x 4.4x 4,6x 4,Tx $7.57 352.7 $5,190 18.5x 13.8x 11.1x 5.2x 4,5x 4.2x $11.07 456.6 $5,014 $10,033 $1,398 $3,611 12.8x 12.6x 13.5x 5.7x 5.8x 6.1x $17.88 77.5 14.0x 13.2x 12.1x 5.9x 4. 9x 4,3 $15.03 30.2 $422 $41 7 10.4x 10.0x 8.6x 6.0x 5.4x 4.9x $3.28 201.1 $640 $2,777 7.7x 7.5x 6.9x 6.0x 6.1x 6.1x $1.49 63.1 $95 $78 17.5x 12.4x 9.9x 8.9x 8. 0x 6,2 $1.60 200.0 $318 $470 10.7x 8.9x 7.3x 7,9x 6.9x 6.5x Comparable Compary Analysis EVEBITDA Summary P/E Mkt Cap 2010A Price Shares EV 2011E 2012E 2010A 2011E 2012E Company Comps Company A Company B Company C Company D Company E Company F Company G Company H Company $16.95 60.2 $1,032 $1,805 $9,257 $19,074 $2,635 13.6x 11.7x 10.9x 4.4x 3. 8 3.7x 1,730.2 $5.26 15.8x 15.2x 14.5x 4.4x 4,6x 4,Tx $7.57 352.7 $5,190 18.5x 13.8x 11.1x 5.2x 4,5x 4.2x $11.07 456.6 $5,014 $10,033 $1,398 $3,611 12.8x 12.6x 13.5x 5.7x 5.8x 6.1x $17.88 77.5 14.0x 13.2x 12.1x 5.9x 4. 9x 4,3 $15.03 30.2 $422 $41 7 10.4x 10.0x 8.6x 6.0x 5.4x 4.9x $3.28 201.1 $640 $2,777 7.7x 7.5x 6.9x 6.0x 6.1x 6.1x $1.49 63.1 $95 $78 17.5x 12.4x 9.9x 8.9x 8. 0x 6,2 $1.60 200.0 $318 $470 10.7x 8.9x 7.3x 7,9x 6.9x 6.5x

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Contemporary Auditing Real Issues And Cases

Authors: Michael C. Knapp

6th Edition

0324303254, 9780324303254

More Books

Students also viewed these Accounting questions

Question

5. What are the other economic side effects of accidents?

Answered: 1 week ago