Question: Calculate the present value of the Terminal Value using the Exit Multiples method using the information outlined below: In the last year of a five-year

Calculate the present value of the Terminal Value using the Exit Multiples method using the information outlined below:

  • In the last year of a five-year forecast, the company was projected to perform as follows:
    • EBIAT of $100
    • Tax rate of 25%
    • Depreciation expense of $10
    • Capital Expenditures of $12
    • Change in NWC of $7
    • EV/EBITDA comparables of 10x
    • WACC of 8%

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!

Q:

Jarmuz Management Services began business on January 1, 2014, with a capital investment of $120,000. The company manages condominiums for owners (Service Revenue) and rents space in its own office...

Q:

16) Calculate the Present Value of the Terminal Value using the Exit Multiples Method using the information outlined below (8 points): In the last year of a five (5) year forecast, the company was...

Q:

Calculate the present value of the Terminal Value using the Exit Multiples method using the information outlined below: In the last year of a five-year forecast, the company was projected to perform...

Q:

Calculate the present value of the Terminal Value using the Gordon Growth perpetuity method using the information outlined below: In the last year of a five-year forecast, the company was projected...

Q:

The following forecast inputs for Jensen Co. and the income statement forecast for 2021 (only) should be used to answer the questions below. $000s 2021F 2022F 2023F 2024F Income Statement: Net Sales...

Q:

can you help with this homework assignment please. thank you Chapter 9: Homework. Total 40 points. Question 1. Below is forecasting information for AZN Inc. 2016 2017 2018 Projected EBIT $350 $375...

Q:

Develop a market-based valuation for Kohler stock by: Creating valuation multiples for the comparable companies (Exhibit 7b) Price to earnings (Net Income or EBITDA, but be consistent) Price to sales...

Q:

6-7; 6-9; 6-12 . I need help with these finance questions. PROBLEM 6-1 Cash provided by operations (CPBO) differs from free cash flow for the following reasons: 1. Solution Legend = Value given in...

Q:

I've calculated it twice and gotten an npv of 8.8 million and 6.5 million, but don't know which is correct. 2. Make the following base-case assumptions to forecast 2019-2023. Revenue growth will be...

Q:

Can you assist me with this finance questions? 6-8 6-11 6-14. The other one is 8-4. Thank you PROBLEM 6-1 Cash provided by operations (CPBO) differs from free cash flow for the following reasons: 1....

Q:

Can someone answer these questions, and show work that I can use as examples? Thanks Question 1. Below is forecasting information for AZN Inc. 2016 2017 2018 Projected EBIT $350 $375 $395 Earnings...

Q:

Bruno, Inc., manufactures display cases for retail stores. Good-4-U Foods, Inc., is a grocery chain that decided to expand into video rental and needs display cases. Good-4-U Foods offered to...

Q:

Using the attached General Journal, record the following business transactions. Each transaction is worth 2 marks. June 2, 2020 Justin Case invests $25,000.00 to open up a paralegal firm. June 2,...

Q:

Use the graph of f to evaluate the expressions in parts a ) through f ) . If the limit or function value being asked for dpesn't exist, enter DNE.a ) lim x 2 - f ( x ) b ) lim x 2 ' f ( x ) c ) lim x...

Q:

If you select a simple random sample of M&M plain candies and construct a normal quantile plot of their weights, what pattern would you expect in the graph?

Q:

Two airplanes are performing at an air show. Plane A travels along the path shown and, for the instant under consideration, has a speed of 265 mi/hr that is increasing at a rate of 4 mi/hr every...

Q:

Determine the output voltage Vo(t) in the network in fig if the input is given by the source in fig. Discuss.

Q:

Use the Maclaurin series for sin x and cos x along with long division to find the first three nonzero terms of a power series in x for the function f(x) = sinx/cosx.

Q:

What are the key attributes of mobile wireless internet devices that add value to users beyond those offered by fixed internet connections?

Q:

Within a continuously competitive global business environment, publicly held companies face constant pressure to generate and report positive financial results. Unfortunately, some leaders may be...

Q:

3.114 A market-research group specializes in providing assessments of the prospects of sites for new childrens toy stores in shopping centers. The group assesses prospects as good, fair, or poor. The...

Q:

3.112 The accompanying table shows, for 1,000 forecasts of earnings per share made by financial analysts, the numbers of forecasts and outcomes in particular categories (compared with the previous...

Q:

3.110 A life insurance salesman finds that, of all the sales he makes, 70% are to people who already own policies. He also finds that, of all contacts for which no sale is made, 50% already own life...