Question: what is the equity value using the PE Methodolgoy Deals Enter prises Tin equity valuationv FIN300 - Equity Valuation Exercise Bears Enterprises (ticker: BE) is
Deals Enter prises Tin equity valuationv FIN300 - Equity Valuation Exercise Bears Enterprises (ticker: BE) is engaged in the business of making athletic shoes. a.lt pays a dividend of $150 per quarter, some people believe it will stay the sanne and others believe it will grow by 4% per year b. Other shoe manufacturers trade in the market for 8.0x ERITDA C. Other similar companies also trade with a PE multiple of 18x d.BE has $100mm in short term debt and $50mm in long term debt: it pays interest at an average annual rate of 4%. e. Assume a discount rate of 9%. f. BE reported $900 million in Revenue and Net Income of $25mm in its most recent year g. On its balance sheet, BE has $75 million of Accounts Receivable, $100 million of inveetory, $25 million of Accounts Payable, and $1 50 million of Fixed Assets (PP&E) h. BE's fixed assets were recently appraised at a value of $300mm i. It reported $5mm in depreciation last year. j. BE trades on NASDAQ and closed yesterday at $90 k. BE has 15 million shares authorized; it has l million treasury shares; it has 11 million issued shares. l.IE has a total tax rate of 25%. Diwidend Growingkae Liquidation value EBITDA Market Value PE Method method Dividend MacBook A
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