Question

Using the following information about Smudge Inc, calculate the EBITDA multiple. Share price 35.34 Shares outstanding...

Using the following information about Smudge Inc, calculate the EBITDA multiple.

Share price 35.34
Shares outstanding 444,688.0
Noncontrolling interests 78,224.0
Short term debt 12,000.0
Long term debt 40,500.0
Cash and cash equivalents 8,400.0
EPS 1.00
Operating profit 1,784,000.0
EBIT 2,124,600.0
Depreciation 26,500.0
Amortization 19,200.0
Business   Finance   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

The formula to calculate EBITDA Multiple = Enterprise Value / EBITDA

Let us now calculate the Enterprise Value and EBITDA

Formula for Enterprise Value = (Market capitalization + Value of debt + Minority interest + Preferred shares) – (Cash and Cash equivalents)

Market capitalization = share price * number of outstanding shares = 35.34 *444,688 = 15,715,273.92

Value of debt = short term debt + long term debt = 12,000 + 40,500 = 52,500

Minority interest = Non controlling interest = 78,244

Cash and Cash equivalents = 8,400

Enterprise Value = [15,715,273.92 + 52,500 + 78,244] -8,400 = 15,837,617.92

EBITDA = EBIT + Depreciation + Amortization = 2,124,600 + 26,500 + 19,200 = 2,170,300

EBITDA Multiple = Enterprise Value / EBITDA = 15,837,617.92/ 2,170,300

= 7.297432

EBITDA Multiple =7.3

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
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?
Amounts are in thousands of dollars (except number of shares and price per share): Kiwi Fruit...
Amounts are in thousands of dollars (except number of shares and price per share): Kiwi Fruit Company Balance Sheet Cash and equivalents $ 480 Operating assets 760 Property, plant, and equipment 3,000 Other assets 165 Total assets $ 4,405 Current liabilities $ 980 Long-term debt 1,375 Other liabilities 175 Total liabilities $ 2,530 Paid in capital $ 395 Retained earnings 1,480 Total equity $ 1,875 Total liabilities and equity $ 4,405 Kiwi Fruit Company Income Statement Net sales $ 6,700...
1. Earnings per share analysis. Chloroline Inc. has 2 million shares outstanding and no debt. Earnings...
1. Earnings per share analysis. Chloroline Inc. has 2 million shares outstanding and no debt. Earnings before interest and tax (EBIT) are projected to be $15 million under normal conditions, $5 million for a downturn in the economic environment, and $20 million for economic expansion. Chlorine considers a debt issue of $50 million with an 8 percent interest rate. The proceeds would be used to buy back one million shares at the current market price of $50 a share. The...
Amounts are in thousands of dollars (except number of shares and price per share): Kiwi Fruit...
Amounts are in thousands of dollars (except number of shares and price per share): Kiwi Fruit Company Balance Sheet Cash and equivalents $ 470 Operating assets 730 Property, plant, and equipment 2,900 Other assets 150 Total assets $ 4,250 Current liabilities $ 980 Long-term debt 1,280 Other liabilities 160 Total liabilities $ 2,420 Paid in capital $ 380 Retained earnings 1,450 Total equity $ 1,830 Total liabilities and equity $ 4,250 Kiwi Fruit Company Income Statement Net sales $ 9,600...
Amounts are in thousands of dollars (except number of shares and price per share): Kiwi Fruit...
Amounts are in thousands of dollars (except number of shares and price per share): Kiwi Fruit Company Balance Sheet Cash and equivalents $620 Operating assets 800 Property, plant, and equipment 3,200 Other assets 185 Total assets $4,805 Current liabilities $1,040 Long-term debt 1,635 Other liabilities 195 Total liabilities $2,870 Paid in capital $415 Retained earnings 1,520 Total equity $1,935 Total liabilities and equity $4,805 Kiwi Fruit Company Income Statement Net sales $8,100 Cost of goods sold −6,700 Gross profit $1,400...
Amounts are in thousands of dollars (except number of shares and price per share): Kiwi Fruit...
Amounts are in thousands of dollars (except number of shares and price per share): Kiwi Fruit Company Balance Sheet Cash and equivalents $ 330 Operating assets 660 Property, plant, and equipment 2,700 Other assets 115 Total assets $ 3,805 Current liabilities $ 920 Long-term debt 1,035 Other liabilities 125 Total liabilities $ 2,080 Paid in capital $ 345 Retained earnings 1,380 Total equity $ 1,725 Total liabilities and equity $ 3,805 Kiwi Fruit Company Income Statement Net sales $ 6,500...
ou are given the following information for Smashville, Inc. Cost of goods sold: $ 224,000 Investment...
ou are given the following information for Smashville, Inc. Cost of goods sold: $ 224,000 Investment income: $ 2,400 Net sales: $ 389,000 Operating expense: $ 90,000 Interest expense: $ 7,400 Dividends: $ 15,000 Tax rate: 35 % Current liabilities: $ 24,000 Cash: $ 21,000 Long-term debt: $ 24,000 Other assets: $ 40,000 Fixed assets: $ 136,000 Other liabilities: $ 5,000 Investments: $ 44,000 Operating assets: $ 37,000    During the year, Smashville, Inc., had 17,000 shares of stock outstanding...
The following information applies to RTC Logistics Ltd.: Operating income (EBIT) = $300,000 Shares outstanding =...
The following information applies to RTC Logistics Ltd.: Operating income (EBIT) = $300,000 Shares outstanding = 120,000 shares Debt = $100,000 EPS = $1.45 Interest expense = $10,000 Stock price = $17.40 Tax rate = 40% The company is considering recapitalization where it would issue $348,000 worth of new debt and use the proceeds to buy back $348,000 worth of common stock. The buyback will be undertaken at the pre-recapitalization share price of $17.40 per share. The recapitalization is not...
John’s shop has 700 shares outstanding at a market price per share of $17. Sam’s has...
John’s shop has 700 shares outstanding at a market price per share of $17. Sam’s has 300 shares outstanding at a market price of $35 a share. Neither firm has any debt. Sam’s is acquiring John’s for $27,000 in cash. What is the merger premium per share? Red’s, Inc. and Bed’s, Inc. are all-equity firms. Red’s has 3,700 shares outstanding at a market price of $14 a share. Bed’s has 500 shares outstanding at a price of $18 a share....
Suppose that in the end of January 2020, you have the following financial information about T...
Suppose that in the end of January 2020, you have the following financial information about T Co. : Sales of $518 million EBITDA of $55.6 million Cash of $100 million Debt of $3 million Number of shares 21 million EPS of 1.65 Book value of equity of $12.05 million. Assume that from a list of T Co.'s comparable firms you computed the following information: P / E P / Book Equity EV / Sales EV / EBITDA Average 15.01 2.84...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT