Computing firm-s value and its ebitda multiple

Assignment Help Finance Basics

Reference no: EM1310332

1) Hagar Enterprises (HA) has a fresh technology for recording heavy metal bands in studio. Firm is confidentially held and there is no public market for its common stock. Hagar’s 2012 EBIT was= $1.5 million. Firm’s year-end 2012 accumulated-depreciation balance was= $1.2 million; at the ending of 2011, accumulated depreciation-balance was $700,000. At the end of 2012, Hagar had total liabilities of= $2.7 million that included a $2 million loan balance, and firm’s total shareholders’ equity balance was= $3.3 million. CEO has asked you to find out value of Hagar Enterprises’ equity. You have found a public company which gives similar digital technology solutions to recording industry, named SoundBytes Corporation (SI). SoundBytes’ share price is= $75 and firm has= 400,000 shares outstanding. SI also has $10 million in bonds outstanding, and its present EBITDA is= $16 million. Be sure to give all computations in your answers to each of following questions:

Questions:

i) Compute Soundbytes’ enterprise value and its EBITDA multiple.

ii) Compute Hagar Enterprise’s EBITDA.

iii) After completing (i) and (ii) above, utilize SI’s EBITDA multiple to find out Hagar Enterprise’s implied Enterprise Value and its estimated equity value.

Reference no: EM1310332

Questions Cloud

Describing elements of financial planning process : Write down two elements of financial planning process?( it is cash planning and profit planning) Why is cash planning as very important as profit planning?

What force does the full moon exert on such a human : A person holds a ladder horizontally at its center. Treating ladder as a uniform rod of length 3.30 m and mass 7.43 kg, find out the torque the person must exert on the ladder to give it an angular acceleration of 0.405 rad/s2.

Program to enter up to 20 integers in the array of long : Write down a program which asks user in order to enter up to 20 integers in the array of longs.The program must utilize the function Find_It() in order to situate the integer within the array.

What power is radiated through this source : A toy of mass 0.155 kg is undergoing SHM on the end of a horizontal spring with forces constant 305 N/m. When object is a distance 1.20×10-2 m from its equilibrium position, it is observed to have the speed of 0.255 m/s.

Computing firm-s value and its ebitda multiple : Compute Soundbytes’ enterprise value and its EBITDA multiple. Compute Hagar Enterprise’s EBITDA.

Find gain or loss will be reported on the income statement : Find gain or loss will be reported on the income statement for the sale of the machine?

Fund balance of capital projects fund : Supposing the county has incurred $800,000 of construction costs on the project by end of its fiscal year (June 30,20x5), the fund balance of capital projects fund employed to account for this project would be?

What is the recoil speed of the rifle as bullet leaves rifle : A 30-06 caliber hunting rifle fires a bullet of mass 0.0146 kg with the velocity of 314 m/s to the right. The rifle has a mass of 2.49 kg.

Reducing the cost per bit transmitted in lans or wans : Systematic and the logical storage of electronic files.specify if reducing the cost per bit transmitted more significant in the LANs or WANs.

User Account

All Pages