Suppose Rocky Brands has earnings per share of $2.35 and EBITDA of $31.4 million. The firm also has 5.9 millie shares outstanding and debt of $115 million (net of cash). You believe Jared's Outdoor Corporation is comparabl Rocky Brands in terms of its underlying business, but Jared's has no debt. If Jared's has a P/E of 13.3 and an en walue to EBITDA multiple of 7.5, estimate the value of Rocky Brands stock using both multiples. Which estimate i to be more accurate? Rocky Brands' stock value by using the P/E ratio is $ 31.26 per share. (Round to two decimal places.) The value of Rocky Brands by using the P/E ratio is $184.4 million. (Round to one decimal place.) The value of Rocky Brands by using the EBITDA ratio is $ million. (Round to one decimal place.)
Suppose Rocky Brands has earnings per share of $2.35 and EBITDA of $31.4 million. The firm also has 5.9 millie shares outstanding and debt of $115 million (net of cash). You believe Jared's Outdoor Corporation is comparabl Rocky Brands in terms of its underlying business, but Jared's has no debt. If Jared's has a P/E of 13.3 and an en walue to EBITDA multiple of 7.5, estimate the value of Rocky Brands stock using both multiples. Which estimate i to be more accurate? Rocky Brands' stock value by using the P/E ratio is $ 31.26 per share. (Round to two decimal places.) The value of Rocky Brands by using the P/E ratio is $184.4 million. (Round to one decimal place.) The value of Rocky Brands by using the EBITDA ratio is $ million. (Round to one decimal place.)
Intermediate Financial Management (MindTap Course List)
13th Edition
ISBN:9781337395083
Author:Eugene F. Brigham, Phillip R. Daves
Publisher:Eugene F. Brigham, Phillip R. Daves
Chapter7: Analysis Of Financial Statements
Section: Chapter Questions
Problem 5P: Needham Pharmaceuticals has a profit margin of 3% and an equity multiplier of 2.0. Its sales are...
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