Question: please provide detailed steps for calculations so I can study them :) 9.0% Venture Corp Valuation -- Multiples Method Assume it is January 1, 2020
9.0% Venture Corp Valuation -- Multiples Method Assume it is January 1, 2020 Financial Projections 2020 Current Bonds Sales 1,000 Annual Coupon Levered FCF (5) Yrs to Maturity NI (Earnings) 15 Risk Free EBITDA 80 Current Spread BV Debt 400 PV MV Debt PV goes here? Cash B/S 100 5 2.0% 3.0% ? Equity EV $1,800 1.8 Industry Comps EV/Sales EV/EBITDA Price/Levered FCF Price/Earnings 006 NA NA Evenly Weighted Average of all Methods = Equity Value = Enterprise Value - Market Value Debt + Cash on B/S Enterprise Value = Equity Value + Market Value Debt - Cash on B/S Assignment 1) Value Equity based on 2020 projected results. 2) Why do the methods provide significantly different valuations? 3) Why is MV of Debt significantly higher than BV and how does this impact your valuation? 4) What process would you use to estimate Financial Projections and Comparable Valuation Multiples
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