KSuppose Rocky Brands has earnings per share of $2.48 and EBITDA of $31.2 million. The firm also has 4.8 million shares outstanding and debt of $135 million (net of cash). You believe Jared'sOutdoor Corporation is comparable to Rocky Brands in terms of its underlying business, but Jared's has no debt. If Jared's has a P/E of 13.5 and an enterprise value to EBITDA multiple of 7.8,estimate the value of Rocky Brands stock using both multiples. Which estimate is likely to be more accurate?Rocky Brands' stock value by using the P/E ratio is $The value of Rocky Brands by using the P/E ratio is $per share. (Round to two decimal places.)million. (Round to one decimal place.)

Given the earnings per share (EPS) of Rocky Brands at $2.48, and the EBITDA at $31.2 million:Rocky…

Answered: K Suppose Rocky Brands has earnings per…

Financial Management: Theory & Practice

16th Edition

ISBN:9781337909730

Author:Brigham

Publisher:Brigham

Chapter14: Distributions To Shareholders: Dividends And Repurchases

Section: Chapter Questions

Problem 12P: Bayani Bakerys most recent FCF was 48 million; the FCF is expected to grow at a constant rate of 6%....

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Macon Mills is a division of Bolin Products. Inc. During the most recent year, Macon had a net income of $40 million. Included in the income was interest expense of $2,800,000. The companys tax rate was 40%. Total assets were $470 million, current liabilities were $104,000,000, and $72,000,000 of the current liabilities are noninterest bearing. What are the invested capital and ROI for Macon?
During 20X2, Norton Company had the following transactions: a. Cash dividends of 20,000 were paid. b. Equipment was sold for 9,600. It had an original cost of 36,000 and a book value of 18,000. The loss is included in operating expenses. c. Land with a fair market value of 50,000 was acquired by issuing common stock with a par value of 12,000. d. One thousand shares of preferred stock (no par) were sold for 14 per share. Norton provided the following income statement (for 20X2) and comparative balance sheets: Required: Prepare a worksheet for Norton Company.
During 20X2, Evans Company had the following transactions: a. Cash dividends of 6,000 were paid. b. Equipment was sold for 2,880. It had an original cost of 10,800 and a book value of 5,400. The loss is included in operating expenses. c. Land with a fair market value of 15,000 was acquired by issuing common stock with a par value of 3,600. d. One thousand shares of preferred stock (no par) were sold for 4.20 per share. Evans provided the following income statement (for 20X2) and comparative balance sheets: Required: Prepare a worksheet for Evans Company.
For a recent year, OfficeMax and Staples are two companies competing in the retail office supply business. OfficeMax had a net income of 34,894,000, while Staples had a net loss of 210,706,000. OfficeMax had preferred stock of 28,726,000 with preferred dividends of 2,123,000. Staples had no preferred stock. The average outstanding common shares for each company were as follows: a. Determine the earnings per share for each company. Round to the nearest cent. b. Evaluate the relative profitability of the two companies.
Bayani Bakerys most recent FCF was 48 million; the FCF is expected to grow at a constant rate of 6%. The firms WACC is 12%, and it has 15 million shares of common stock outstanding. The firm has 30 million in short-term investments, which it plans to liquidate and distribute to common shareholders via a stock repurchase; the firm has no other nonoperating assets. It has 368 million in debt and 60 million in preferred stock. a. What is the value of operations? b. Immediately prior to the repurchase, what is the intrinsic value of equity? c. Immediately prior to the repurchase, what is the intrinsic stock price? d. How many shares will be repurchased? How many shares will remain after the repurchase? e. Immediately after the repurchase, what is the intrinsic value of equity? The intrinsic stock price?
FFDP Corporation has yearly sales of $29.9 million and costs of $15.7 million. The company’s balance sheet shows debt of $55.9 million and cash of $39.9 million. There are 1,960,000 shares outstanding and the industry EV/EBITDA multiple is 9.4. a. What is the company’s enterprise value? b. What is the stock price per share?
Last year the P. M. Postem Corporation had sales of $426, 000, with a cost of goods sold of $113,000. The firm's operating expenses were $130,000, and its increase in retained earnings was $84, 720. There are currently 21,000 shares of common stock outstanding, the firm pays a $1.63 dividend per share, and the firm has no interest-bearing debt. a. Assuming the firm's earnings are taxed at 35 percent, construct the firm's income statement. b. Compute the firm's operating profit margin. Question content area bottom Part 1 a. Training Assuming the firm's earnings are taxed at 35%, construct the firm's income statement. Complete the income statement below: (Round to the nearest dollar.) Income Statement Revenues $ Cost of Goods Sold Gross Profit $ Operating Expenses Net Operating Income $ Interest Expense Earnings before Taxes $ Income Taxes Net Income $
Last year the P.M. Postem corporation had sales of $419,000, with a cost of goods sold of $111,000. The firm’s operating expenses were $126,000, and its increase in retained earnings was $85,700. There are currently 20,000 shares of common stock outstanding, the firm’s pays a $1.63 dividend per share, and the firm has no interest-bearing debt. A. Assuming the firm’s earnings are taxed at 35%, construct the firm’s income statement. Complete the income statement below: round to the nearest dollar Revenues Cost of goods sold Gross profit Operating expenses Net operating income Interest expenses Earnings before taxes Income taxes Net income
Use the information below to build a properly formatted income statement. A: The firm has 12,640,500 shares outstanding and EPS is $3.20.Calculate Net Income . B: The firm's corporate tax rate is 40%. Calculate the firm's EBT. C: After completing A and B above, what is the firm's corporate tax expense? D: The firm's Revenue is $183,600,000 and its operating margin is 45.00%. Calculate EBIT. E: After completing the above: Gross Profit is 1.65 times its EBIT . Calculate Gross Profit . F: Given the above information, calculate the firm's Operating Expenses . G: Given the above information, calculate the firm's Interest Expense .
Last year the P.M. postem corporation had sales of $419,000, with a cost of goods sold of $111,000. The firm’s operating expenses were $126,000, and its increase in retained earnings was $85,700. There are currently 20,000 shares of common stock outstanding, the firm’s pays a $1.63 dividend per share, and the firms has no interest-bearing debt. B. Compute the firm’s operating profit margin The operating profit margin is Round to one decimal place.
Kaye’s Kitchenware has a market/book ratio equal to 1. Itsstock price is $12 per share and it has 4.8 million shares outstanding. The firm’s total capital is $110 million and it finances with only debt and common equity. What is itsdebt-to-capital ratio?
baker industries net income is $24,000 ,its interest expense is $6000, and its take rate is 40%. it notes payable equals 23,000 , long term debt equals 70,000, and common equity equals 240,000. the firm's finances with only debt and common equity, so it has no preferred stock. What is the firm’s ROE and ROIC ?

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