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Business, 12.08.2020 07:01 ladybugys

The free cash flow (FCF) valuation model, the discounted cash flow model, and the corporate valuation model are the most widely used valuation techniques. Often these valuations are accompanied by market multiple analysis, which is based on the fundamental concept that similar assets should have similar values. Cute Camel Woodcraft Company is a privately owned firm with few investors. Investors’ forecast of next year’s earnings per share (EPS) is $3.00. The average price-to-earnings (P/E) ratio for companies similar to Cute Camel in the S&P 500 is 10. Cute Camel’s common stock has an estimated intrinsic value of $ per share. (Note: Round your answer to two decimal places.) The market multiple analysis process is also used to calculate the value of a company, which can then be spread across the number of common shares outstanding to estimate a firm’s per-share intrinsic value. Suppose you have the following information for Denim Duck Electronics, Inc.: Denim Duck Electronics, Inc. Year 1 Year 2 EBITDA $7,650 $9,150 Total value of equity $76,500 $82,500 Total firm value $99,450 $132,000 In Year 1, Denim Duck has an entity multiple of (Note: Round your answer to two decimal places.).

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