You're an investment banker engaged by Porcupine Tree Company regarding their efforts to complete a significant M&A transaction. One of the things you're evaluating is the value of the company Porcupine Tree Company wishes to acquire At issue is a measure of uncertainty in your mind regarding the company's projection for 2020; especially the revenue projection. The target company is a global concern, and the foreign currencies in which it transacts its overseas business did strengthen against the dollar. However, your quick math suggests that doesn't explain the total jump in revenues. The financial history and near term projections for the target company are as set out below. These projections were included in a pitch book you received from the target company's investment banker. Much to your surprise, the pitch book does not explain the sudden jump in revenues or any other figures for the projection of 2020. 2016 2017 2018 2019 2020P $500,000 Revenues (000s) Percent Growth $505,000 1.096 $545,000 7.9% EBITDA 54,000 $50,000 $10,000 $40,000 $0 $535,000 (1.8%) $50,000 $15,000 $35,000 SO $49,000 $10,500 S38,500 $0 Depreciation EBIT $700,000 30.1% $85,000 $20,000 $65,000 $0 10,700 $43,300 SO Interest Expense Free Cash Flow $30,000 $29,000 $10,000 $5,000 $50,000 Here are four questions for your response: 1. What is a possible explanation for the increase in 2020 projected performance, based on the data presented? 2. What analysis can you perform to support your explanation? You've set up a telephone call with the investment banker to review the data, including the 2020 projections. 3. What questions will you ask with respect to the four-year historical trend and the 2020 projection? 4. What additional information would you likely be requesting to help understand the trends at play