Company B, is a private company that designs, manufactures and distributes certain consumer products. In this...
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"Company B, is a private company that designs, manufactures and distributes certain consumer products. In this fiscal year, Company B had revenues of $90 Millions of USDs and earnings of $30 of Millions of USDs. Company B has filed a registration statement with the SEC for its IPO. If the industry average Price/Earnings ratio and Price/Revenues ratio for the recent fiscal year were 14 and 0.8 respectively. Estimate the IPO price for Company B using the Price/Revenues ratio and assuming that they will issue 15 Million shares." "Company B, is a private company that designs, manufactures and distributes certain consumer products. In this fiscal year, Company B had revenues of $90 Millions of USDs and earnings of $30 of Millions of USDs. Company B has filed a registration statement with the SEC for its IPO. If the industry average Price/Earnings ratio and Price/Revenues ratio for the recent fiscal year were 14 and 0.8 respectively. Estimate the IPO price for Company B using the Price/Revenues ratio and assuming that they will issue 15 Million shares."
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Answer rating: 100% (QA)
To estimate the IPO price for Company B we can use the PriceEarnings ratio PE rati... View the full answer
Related Book For
Intermediate Accounting
ISBN: 978-0324659139
11th edition
Authors: Loren A. Nikolai, John D. Bazley, Jefferson P. Jones
Posted Date:
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