Finding Growth Rate from Financial Statements
Hi WSO,
I am working on a modeling assignment for school, which is based on Harvard Business School case studies. This one in particular is the Men's Wearhouse/Jos. A Banks merger model. I am only provided income statement/balance sheet for both, multiples from comparable companies, and risk-free/beta/risk premium chart.
The information that I have is from 2011-2014. Certain balance sheet items such as prepaid expenses, PP & E, depreciation, and notes payable are not provided for the final year (2014).
My TWO questions are: how do I calculate a growth rate for each firm, and do I calculate the missing metrics as a projection, or will they be insignificant in the grand scheme of the model?
This is my first real financial model where I need to figure everything out and key information is not given.
Thanks in advance!
Can you specify what you're trying to find? If you're looking for YoY growth rate of revenue, earnings, etc. I hope I don't have to tell you how to find that (this years revenue - last year's revenue/last year's revenue). Projecting out stuff like PP&E, depreciation, etc. can be done by either looking at historical projections or by using another value's growth as a proxy. Either one is acceptable I think.
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