Expected Company P/E Ratio Beta Payout Growth Boeing 17.3 3.50% 1.1 28% General 15.5 11.50% 1.25 40% Dynamics General Motors 16.5 13.00% 0.85 41% - Hughes Grumman 11.4 10.50% 0.8 37% Lockheed 10.2 9.50% 0.85 37% Corporation Logicon 12.4 14.00% 0.85 11% Loral 13.3 16.50% 0.75 23% Corporation Martin Marietta 11 8.00% 0.85 22% McDonnell 22.6 13.00% 1.15 37% Douglas Northrop 9.5 9.00% 1.05 47% Raytheon 12.1 9.50% 0.75 28% Rockwell 13.9 11.50% 1 38% Thiokol 8.7 5.50% 0.95 15% United 10.4 4.50% 0.7 50% Industrial Estimate a PE regression with all companion variables as independent variables. What is the coefficient estimate O 35.74 O 11.97 O 2.90 O -2.33
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- using the table find the folloing for the four firms: Enterprise value to EBITDA Ratio Price-Earnings multiole PEG raio Cpmpany Market Value (OMR million) Net Income (OMR million) Earnings Growth Market Value of Equity (OMR million) Market Value of Debt (OMR million) Cash (OMR million) EBITDA (OMR million) Happy 117.95 22.5 4% 53.07 64.87 41.25 43.85 Smart 112.35 20.25 4.5% 59.53 52. 79 45 44.88 Kind 116.26 21 4.65% 69.76 46.5 63.95 28.20 Cheerful 120 24 5% 42 78 62.4 44.32Q18 If the company’s EBIT is OMR 500,000; market value of the equity is OMR 2,000,000 and value of Debt is OMR 4,000,000; then what is the overall cost of capital of the firm under Net Income Approach? a. 12.5% b. 10% c. 25% d. 8.33%Can you explain the information below market value added (MVA) analysis and interpretation of results below. Market Value of Equity:$133,341,000,000.00 Plus: Market Value of Debt:$13,677,000.00 Equals: Market Value of Firm:$133,354,677,000.00 Minus: Total Invested Capital:($1,944,100.00) Equals: MVA$133,356,621,100.00
- Para Inc is trading at a forward (EV/FCFF1) Ratio of 20, a forward (EV/ (EBIT1 (1-Tc)) ratio of 10 and (EV/ Capital) ratio of 2. Based on the information, answe the following A. Para Inc. Return on capital equal to ? B. Para Inc. Growth rate equal to ? C. Weighted average cost of capital equal to?YZ Goods target capital structure and other data follow: Long-term debt $ 754,000,000 Preferred stock 40,000,000 Common equity 896,000,000 Total capital $1,690,000,000 Cost of Debt (kd) = 11% for amounts up to 80 M of additional Debt; will rise to 13% after that. Cost of Preferred = 10.5% at any amount T = 40%. P0 = $23. g= 8%, and it is expected to remain constant. Assume that the company expects to have total earnings of $137.8 million in 2020. Further, it has a target payout ratio of 45 percent, so it plans to pay out 45 percent of its earnings as dividends. Flotation cost of 5% is incurred for issuance of new shares. The following projects are available for investment: Project Cost (in Millions) Rate of Return A $50…Return on Capital Employed (ROCE) = For Riccarton PLC: ROCE = 50000/380000 X 100 = 13.2% For Edinburgh PLC: ROCE = 45000/230000 X 100 = 19.6% Current Ratio = Current assets/current liabilities For Riccarton PLC: Current ratio = 150/120 = 1.25 For Edinburgh PLC: Current ratio = 80/70 = 1.14 Gearing Ratio = (long term borrowing + short term borrowings) / equity For Riccarton PLC: Gearing ratio = (180 + 100)/200 = 1.4 For Edinburgh PLC: Gearing ratio = (100 + 50)/130 = 1.15 Price/Earnings (P/E) Ratio = Share price / earnings per share For Riccarton PLC: P/E Ratio = 195/35 =5.57 For Edinburgh PLC: P/E Ratio = 451/28 = 16.107 Based on the above ratios explain, which company George H. and James W. should invest in. You should also briefly discuss the limitations of your analysis.
- Selected ratios formulars Unilever 2021 BOPP 2021 ROCE PBIT / net assets * 100 (32,424/39,406 *100 = - 82% 102,154 / 192,758 *100 =53% Net Assets Turnover Revenue / Net Assets 526,912 / 39,406 = 13 times 214,174 / 192,758 = 1 time Gross Profit Margin Gross profit / revenue *100 97,046 / 526,912 *100 18.4% 115,462 / 214,174 * 100 54% Net Profit Before Tax PBT / revenue * 100 (35,005) / 526,912* 100 = -6.6% 104,778 / 214,174* 100 =48.9% Current Ratio Current assets / current liabilities 214,665/341,171 = 0.5 139,104 / 30,368 = 4.5 Quick Ratio Current assets – inventory / current liabilities 214,665-91,627 /341,171 = 0.4 139,104 -13,248/ 30,368 = 4.1 Inventory Days Inventory / cost of sales * 365 days 91,627/ 429,866 *365 = 77 days 13,248 / 101,397 *365 = 47 days Receivable Days Receivables / cost of sales * 365 days 24,515 / 429,866 *365 =20 days 92,860 / 101,397 *365 =334 days Payable Days…Company X has debt and equity as source of funds..Company X has market value of debt as $ 150000 and a book value of debt as $ 80000. The company has book value of equity as $ 100000 and market value of equity as $ 125000. The cost of debt is 8.25% and cost of equity is 9.57%. The tax rate is 38%. What is WACC?Adams Inc. has the following data: rRF = 4.00%; RPM = 7.00%; and b = 1.20. What is the firm's cost of common from retained earnings based on the CAPM? Group of answer choices 11.53% 12.40% 12.03% 11.78% 12.65%
- Q29 If the company’s Interest on Debt is OMR 50,000 with 10% interest rate, the market value of Equity is OMR 800,000; then what is the Total Value of the firm under Net Operating Income Approach? a. OMR 2,000,000 b. OMR 500,000 c. OMR 1,300,000 d. OMR 800,000Abstract Corporation’s 2014 EBIT and EPS were $10 million and $1.80 respectively. In 2015, the company’s EBIT and EPS were $12 million and $2.20 respectively. Given this information, calculate the company’s degree of financial leverage. Multiple Choice 1.22 1.44 1.11 1.00 1.33A3) Finance From the information below, select the capital structure that results in the lowest WACC for Humungo Sportainment Industries. Rd below is after tax. a. Debt = 0%; Equity = 100%; Stock Price = $16.00; Rd = 6.60% b. Debt = 20%; Equity = 80%; Stock Price = $16.25; Rd = 7.00% c. Debt = 40%; Equity = 60%; Stock Price = $16.50; Rd = 7.60% d. Debt = 50%; Equity = 50%; Stock Price = $16.75; Rd = 8.40% e. Debt = 60%; Equity = 40%; Stock Price = $16.00; Rd = 9.40%