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You are trying to estimate the brand name value for Steinway, one of the worlds best-known piano manufacturers. The firm reported operating income of $30
You are trying to estimate the brand name value for Steinway, one of the worlds best-known piano manufacturers. The firm reported operating income of $30 million on revenues of $100 million in the most recent year; the tax rate is 40%. The book value of capital at the firm is $90 million, and the cost of capital is 10%. The firm is in stable growth and expects to grow 5% a year in perpetuity. Estimate the value/sales ratio for this firm.
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