Using the enterprise value/EBITDA multiple, what is the total value of Johnson Machine Tool Company? What is the per share value of Johnson’s stock?
Use the following information concerning Johnson Machine Tool Company. Johnson’s income statement from the fiscal year that ended this past December is:
Revenue ................ $995
Cost of goods sold ............. 652
Gross profit ............... $343
Selling, general, and administrative expenses .. 135
Operating profit (EBIT) .......... $208
Interest expense ................ 48
Earnings before taxes ............ $160
Taxes .................. 64
Net income ............... $ 96
All dollar values are in millions. Depreciation and amortization expenses last year were $42 million, and the company has $533 million of debt outstanding.