Question

In: Finance

Suppose that in July? 2013, Nike Inc. had sales of $25,217 million, EBITDA of $3,247 million,...

Suppose that in July? 2013, Nike Inc. had sales of $25,217 million, EBITDA of $3,247 million, excess cas of 3,337 million, $1,383 million of debt, and 901.2 shares outstanding

StartFraction Upper P Over Upper E EndFractionPE

StartFraction Price Over Book EndFractionPriceBook

StartFraction Enterprise Value Over Sales EndFractionEnterprise ValueSales

StartFraction Enterprise Value Over EBITDA EndFractionEnterprise ValueEBITDA

Average

29.84

2.44

1.12

9.76

Maximum

plus+136%

plus+70%

plus+55%

plus+86%

Minimum

minus?626%

minus?63%

minus?48?%

minus?34%

a. Using the average enterprise value to sales multiple in the table? above, estimate? Nike's share price.

b. What range of share prices do you estimate based on the highest and lowest enterprise value to sales multiples in the table? above?

c. Using the average enterprise value to EBITDA multiple in the table? above, estimate? Nike's share price.

d. What range of share prices do you estimate based on the highest and lowest enterprise value to EBITDA multiples in the table? above?

Solutions

Expert Solution


Related Solutions

Suppose that in July​ 2013, Nike Inc. had sales of $ 25 comma 245 ​million, EBITDA...
Suppose that in July​ 2013, Nike Inc. had sales of $ 25 comma 245 ​million, EBITDA of $ 3 comma 259 ​million, excess cash of $ 3 comma 333 ​million, $ 1 comma 395 million of​ debt, and 894.1 million shares outstanding. StartFraction Upper P Over Upper E EndFraction StartFraction Price Over Book EndFraction StartFraction Enterprise Value Over Sales EndFraction StartFraction Enterprise Value Over EBITDA EndFraction Average 29.84 2.44 1.12 9.76 Maximum plus136​% plus70​% plus55​% plus86​% Minimum minus62​% minus63​% minus48​%...
Suppose that in July​ 2013, Nike Inc. had EPS of ​$2.45 and a book value of...
Suppose that in July​ 2013, Nike Inc. had EPS of ​$2.45 and a book value of equity of ​$11.78 per share. StartFraction Upper P Over Upper E EndFraction P E StartFraction Price Over Book EndFraction Price Book StartFraction Enterprise Value Over Sales EndFraction Enterprise Value Sales StartFraction Enterprise Value Over EBITDA EndFraction Enterprise Value EBITDA Average 29.84 29.84 2.44 2.44 1.12 1.12 9.76 9.76 Maximum plus + 136 136​% plus + 70 70​% plus + 55 55​% plus + 86...
Suppose that in July​ 2013, Nike Inc. had EPS of ​$2.61 and a book value of...
Suppose that in July​ 2013, Nike Inc. had EPS of ​$2.61 and a book value of equity of $12.52 per share.    p/e | price/book | enterprise value / sales | enterprise value/EBITDA AVG: 29.84 | 2.44 | 1.12 | 9.76 MAX: +136% | +70% | +55% | +86% MIN:   -62% | -63% | -48% | -34% a. Using the average​ P/E multiple from the table​ above, estimate​ Nike's share price. b. What range of share prices do you estimate...
Suppose that in July​ 2013, Nike Inc. had EPS of ​$2.36 and a book value of...
Suppose that in July​ 2013, Nike Inc. had EPS of ​$2.36 and a book value of equity of ​$13.27 per share. P/e Price/Book Enterprise Value/Sales Enterprise Value/EBITDA Average 29.84 2.44 1.12 9.76 Max + 136% + 70% +55% +86% Min -62% -63% -63% - 34% a. Using the average​ P/E multiple from the table​ above, estimate​ Nike's share price. b. What range of share prices do you estimate based on the highest and lowest​ P/E multiples in the table​ above?...
In July 2013, Nike had EPS of $2.52 and a book value of equity of $12.48...
In July 2013, Nike had EPS of $2.52 and a book value of equity of $12.48 per share. a. Using the average P/E mulitple in Table 2, estimate Nike's share price. b. What range of share prices do you estimate based on the highest and lowest P/E multiples in Table 2? c. Using the average price-to-book value mlutiple in Table 2, estimate Nike's share price. d. What range of share prices do you estimate based on the highest and lowest...
Suppose that in January 2006, Kenneth Cole Productions had sales of $518 million, EBITDA of $55.6...
Suppose that in January 2006, Kenneth Cole Productions had sales of $518 million, EBITDA of $55.6 million, excess cash of $100 million, $3 million of debt, and 21 million shares outstanding. Sales 518.00 EBITDA 55.60 Cash 100.00 Debt 3.00 Shares outstanding 21 a) Using the average enterprise value to EBITDA multiple in Table 1, estimate KCP’s share price. b) What range of share prices do you estimate based on the highest and lowest enterprise value to EBITDA multiples in Table...
Nike had sales of $40 billion in 2019. Suppose you expect its sales to grow at...
Nike had sales of $40 billion in 2019. Suppose you expect its sales to grow at a rate of 4% forever. Based on Nike’s past profitability and investment needs, you expect EBIT to be 10% of sales, increases in net working capital requirements to be 12% of any increase in sales, and capital expenditures to equal depreciation expenses. Nike pays 22% income tax. The opportunity cost of capital is 10%. Nike has 0.9 billion shares outstanding, $3.3 billion in cash,...
Consider the following data for Nike​ Inc.: In 2009 it had $ 19 comma 150 million...
Consider the following data for Nike​ Inc.: In 2009 it had $ 19 comma 150 million in sales with a 10​% growth rate in​ 2010, but then slows by 1 % to the​ long-run growth rate of 5​% by 2015. Nike expects EBIT to be 10​% of​ sales, increases in net working capital requirements to be​ 10% of any increases in​ sales, and capital expenditures to equal depreciation expenses. Nike also has ​$2 comma 300 million in​ cash, ​$32 million...
Seashell Mfg., Inc. had $750 million of sales last year, and it had $435 million of...
Seashell Mfg., Inc. had $750 million of sales last year, and it had $435 million of fixed assets that were used at only 65% of capacity. What is the maximum sales growth rate Seashell could achieve before it had to increase its fixed assets?
Suppose the comparative balance sheets of Nike, Inc. are presented here. Nike, Inc. Condensed Balance Sheet...
Suppose the comparative balance sheets of Nike, Inc. are presented here. Nike, Inc. Condensed Balance Sheet May 31 ($ in millions) 2020 2019 Assets Current Assets $9,600 $8,830 Property, plant, and equipment (net) 2,000 1,900 Other assets 1,500 1,700 Total assets $13,100 $12,430 Liabilities and Stockholders' Equity Current Liabilities $3,240 $3,320 Long-term liabilities 1,200 1,340 Stockholders’ equity 8,660 7,770 Total liabilities and stockholders' equity $13,100 $12,430 (a) Prepare a horizontal analysis of the balance sheet data for Nike, using 2019...
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT