Determine the valuation of my company with reference both to its financial price and its market value using the  3 methods: DCF, comparable transactions and comparable peer group of listed companies) ?

Information :

As of FY end 2019, the company grew up to a 400M€ sales business with 21 clinics and 5 retirement homes with medical assistance for elderly people, all settled in the west of the USA  It grew steadily at an annual rate of 5% over the last 10 years - only through organic growth.

 Its EBITDA (EBIT) margins is 10% (6%) of sales and remained stable at this level during the last 10 years too. 3 years ago C acquired the CANADIAN group B which operated 5 retirement homes but needed to sell it in Q1, 2020 to its managers (doctors, nurses) because this acquisition turned into a failure due to the strong opposition of the doctors and nurses - who actually already bid unsuccessfully for acquiring B through an LBO.

 This lead to a 20M€ extraordinary one-time off loss for MY COMPANY which needed a refinancing recently through debt. 

Furthermore the Covid crisis gave an impulse in sales but increased the Working Capital from 20 days of sales up to 35 days of sales. This adverse change in WC and the one-time off loss so put our free cash flow under pressure. For the 1rst time in years C will not pay dividends.

 As such as of FY 2020, our estimated 400M€ Debt to 330M€ Equity ratio will worsen to 120%. Our CFO expects 2020 sales to grow 9% vs 2019 but EBITDA margin to go down to 6% of sales. He prepared a Business plan (2021 onwards) which assumes that C will recover its previous EBITDA margin of 10% in 2023 and improve its Debt to Equity ratio to 0,95.

Answer rating: 100% (QA)

To determine the valuation of your company using three methods DCF Discounted Cash Flow comparable transactions and comparable peer group of listed co... View the full answer