Estimate the terlingua equity beta

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Question - Terlingua Energy Resources is a privately held, all equity firm. Managers at Terlingua need to estimate equity beta for their common stock. Here is data on four competitors. The four companies are publicly traded, all equity firms.

Company

Beta

Book value of equity ($ million)

Share price ($)

Shares outstanding (millions)

Hallibuddy Co.

1.15

500

30.26

40

Schlumbertime Ltd.

1.30

1,000

36.4

30

Felix Energy Inc.

1.50

750

89.34

25

Suferior Energy Co.

1.75

2,000

118.65

20

Required - Estimate the Terlingua's equity beta using the best procedure described in the lecture.

Reference no: EM133064209

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