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EV/EBITDA ratio of a competitor company is 14.45. EBITDA of Raspberry Inc is $134 M, it...

EV/EBITDA ratio of a competitor company is 14.45. EBITDA of Raspberry Inc is $134 M, it has $500 M debt outstanding, $100 M cash balance and 20 M shares. What is the share price implied by the EV/EBITDA multiple?

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Answer #1
EV/EBITDA of competitor Company= 14.45
EBItDA of Rasberry Inc= $ 134 million
So EV of Raspberry= 134*14.45= 1936.3
EV = market capitalization + value of debt + minority interest + preferred shares - cash and cash equivalents
Market Capital= (1936.30-500+100)
1536.3 million
Shares O/s 20 million
So price per share= 1563.3/20
$                    78.17
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