Question
You are supposed to calculate the equity value of a private firm. Here is the financial statements of the private firm ( in thousands) :
You are supposed to calculate the equity value of a private firm. Here is the financial statements of the private firm ( in thousands) :
2016 | |
Current Assets | |
Cash and equivalents | $20,000 |
Receivables | 40,000 |
Inventories | 29,000 |
Other current assets | 23,000 |
Total current assets | $112,000 |
Noncurrent Assets | |
Property, plant, and equipment | $145,000 |
Less: Accumulated depreciation | 43,000 |
Net property, plant, and equipment | 102,000 |
Investments | 70,000 |
Other noncurrent assets | 36,000 |
Total noncurrent assets | 208,000 |
Total assets | $320,000 |
Current Liabilities | |
Accounts payable | $41,000 |
Short-term debt | 12,000 |
Other current liabilities | 17,000 |
Total current liabilities | $70,000 |
Noncurrent Liabilities | |
Long-term debt | 100,000 |
Total noncurrent liabilities | 100,000 |
Total liabilities | 170,000 |
Shoreholders' Equity | |
Common equity | 40,000 |
Retained earnings | 110,000 |
Total equity | 150,000 |
Total iabilities and equity | $320,000 |
2016 | |
Sales | $250,000 |
Cost of goods sold | 125,000 |
Gross operating profit | 125,000 |
Selling, general, and administrative expenses | 50,000 |
EBITDA | 75,000 |
Depreciation and amorization | 10,500 |
EBIT | 64,500 |
Interest expense | 11,000 |
Pretax income | 53,500 |
Income taxes | 16,050 |
Net income | $37,450 |
Shares outstanding | 13,000 |
EPS | 2.88 |
You also find the following four competitors and their enterprise value and EBITD:
($ millions) | APU | PRAX | AIT | ARG |
Enterprise Value | 31,140 | 47,400 | 2,010 | 10,454 |
EBITDA | 2,481 | 3,703 | 197 | 943 |
A) What is the enterprise value of the private firm based on the EBITDA multiple valuation?
B) What is the equity value? What is the equity value per share?
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