Valuation questions
Hi guys,
I am a novice at valuation, just getting into finance. Wanted to ask if you guys could help me out understanding how to calculate these things:
1) Company financials: EV/EBITDA = 8x, P/E = 15x, net earnings = 100, net debt = 50
- how do you calculate EV, equity value and EBITDA of this company based on the above data?
2) How do you calculate discounted equity cash flow with the following data?
Long term debt = 1800
Short term debt = 600
Interest rate on short term debt = 20
Interest rate on long term debt = 140
Surplus cash = 500
Market cap = 1100
Equity FCF = 300
Tax rate = 35%
Risk-free rate = 3%
Market risk premium = 6%
3) Estimate EV and equity value of following company for 2012 based on following financial data:
2011 2012
EBITDA 200 250
Investments 40 50
Divestments 10 10
Acc payable 40 50
Acc receivable 70 80
Inventory 15 20
Cash 40 70
Short term debt 20 30
Long term debt 50 40
Depreciation 20 10
minority interest 5 15
1) Equity value = 15*100 = 1500 EV = 1500+50 = 1550 EBITDA = 1550/8 = 193.75
You should be able to do the rest of your hw
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