Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

You are trying to value a local grocery store company, Reddy Gourmet Foods. Its EPS is $ 1 . 6 0 , and it has

You are trying to value a local grocery store company, Reddy Gourmet Foods. Its EPS is $1.60, and it has 30% EBITDA margin (EBITDA as % of Sales),12% net profit margin and no debt and negligible excess cash. You collect below information on comps. Calculate an estimate for the company stock value. (5pts) You are trying to value a local grocery store company, Reddy Gourmet Foods. Its EPS is $1.60, and it has 30% EBITDA margin (EBITDA as % of Sales),12% net profit margin and no debt and negligible excess cash. You collect below information on comps. Calculate an estimate for the company stock value. (5pts)
\table[[,Stock Price,EV/EBITDA],[Costco Wholesale (COST),$560.14,18.6],[Kroger Co.(KR),$43.35,16.8],[Sprouts (SFM),$24.95,11.2]]
\table[[,Stock Price,EV/EBITDA],[Costco Wholesale (COST),$560.14,18.6],[Kroger Co.(KR),$43.35,16.8],[Sprouts (SFM),$24.95,11.2]]
image text in transcribed

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_2

Step: 3

blur-text-image_3

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

Investments An Introduction

Authors: Herbert B. Mayo

12th edition

1305638417, 978-1337430937, 1337430935, 978-1305638419

More Books

Students also viewed these Finance questions

Question

Why is advertising prevalent in monopolistic competition?

Answered: 1 week ago

Question

The effect of neurotransmitters may be..........?

Answered: 1 week ago

Question

Where was the declaration of independence signed?

Answered: 1 week ago