Question: Continuing with the project to value Getinge AB, you have compiled the information on GETI and peer companies Smith & Nephew plc (London: SN) and
Continuing with the project to value Getinge AB, you have compiled the information on GETI and peer companies Smith & Nephew plc (London: SN) and CR Bard Inc.
(NYSE: BCR) given in Exhibit 13.

Use the data in Exhibit 13 to address the following:
i. Based on the P/S but referring to no other information, assess GETI’s relative valuation.
ii. State whether GETI is more closely comparable to SN or to BCR. Justify your answer.
EXHIBIT 13 P/S Comparables (as of 4 October 2013) Measure GETI SN BCR Price/Sales (ttm) 2.14 2.66 3.07 Profit Margin (ttm) 8.82% 13.21% 6.25% Quarterly Revenue Growth (yoy) 7.20% 4.40% 2.30% Total Debt/Equity (mrq) 115.86 9.83 94.97 Enterprise Value/Revenue (ttm) 2.79 2.73 3.28
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i Because the PS for GETI 214 is the lowest of the three PS multiples if no ... View full answer
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