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Consider recent financials for Ellie's Essentials LLC: Balance Sheet 2018 2017 Current Assets $11,438.00 $10,000.00 Net...
Consider recent financials for Ellie's Essentials LLC:
Balance Sheet
| 2018 | 2017 | |
|---|---|---|
| Current Assets | $11,438.00 | $10,000.00 |
| Net PPE | $31,000.00 | $30,000.00 |
| Total Assets | $42,438.00 | $40,000.00 |
| Current Liabilities | $8,736.00 | $8,000.00 |
| Long-term debt | $12,728.00 | $12,000.00 |
| Total Liabilities | $21,464.00 | $20,000.00 |
| Shareholder Equity | $20,974.00 | $20,000.00 |
| Liabilities and Equity | $42,438.00 | $40,000.00 |
| Income Statement | 2018 | 2017 |
|---|---|---|
| SALES | $11,000.00 | $10,000.00 |
| COGS | $4,400.00 | $4,000.00 |
| GROSS PROFIT | $6,600.00 | $6,000.00 |
| S&A | $1,100.00 | $1,000.00 |
| Depreciation | $550.00 | $500.00 |
| EBIT | $4,950.00 | $4,500.00 |
| INTEREST | $1,272.00 | $1,200.00 |
| EBT | $3,678.00 | $3,300.00 |
| TAXES (36.00%) | $1,324.08 | $1,188.00 |
| NET INCOME | $2,353.92 | $2,112.00 |
Going forward, analysts have forecasted the following free cash
flows: $2,600.00 in 2019, and $2,600.00 in 2020. After that point,
analysts expect free cash flows to grow at 3.00%. The firm has no
short-term debt or preferred stock, and there are 1,000 shares
outstanding. The firm's cost of capital is 10.00%.
You are trying to estimate the value of Doc McRuffins Incorporated. It is a rival firm to Ellie's Essentials, but not publicly traded. You do know that Doc McRuffins has an EBITDA of $4,750 for 2018. Using multiples, what is a rough estimate for the enterprise value of Doc McRuffins
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Expert Solution
| Valuation of Ellie's Essentials LLC | ||||
| Year | Free Cash Flows | P.V. Factor | Present Value ($ Million) | |
| Remarks | Cash Flow ($ ) | [@10%] | [Cash Flow*P.V. Factor] | |
| 2019 | 2600.00 | 0.9091 | 2363.66 | |
| 2020 | 2600.00 | 0.8264 | 2148.64 | |
| Continuing value at 2020 year end | As per working Note 1 | 38257.14 | 0.8264 | 31615.70 |
| Value of Firm at 2018 | 36128.00 | |||
| Valuation of Doc McRuffins | ||||
| Particulars | Amount ($) | |||
| EBIDTA of Ellie's Essentials LLC | 5500 | |||
| Value of Ellie's Essentials LLC | 36128 | |||
| Value to EBIDTA Multiple | [36128/5500] | 6.5687 | ||
| EBIDTA of Doc McRuffins | 4750.00 | |||
| Value of Doc McRuffins |
[EBIDTA*Value to EBIDTA] 4750*6.5687 |
31201.46 | ||
| Working Note 1 | |||
| Continuing value at the end of 2020 | |||
|
= Free Cash flow at end of 2021 WACC-Growth Rate |
|||
|
= 2600*1.03 10.00%-3.00% |
|||
|
= 2678 7.00% |
|||
| = $ 38257.1429 milion |
| Working Note 2 | |
| EBIDTA of Ellie's Essentials LLC | |
| Sales | 11000 |
| COGS | 4400 |
| Gross Profit | 6600 |
| S&A | 1100 |
| EBIDTA | 5500 |
jeff jeffy answered 1 year agoRelated Solutions
Consider recent financials for Ellie's Essentials LLC: Balance Sheet 2018 2017 Current Assets $11,438.00 $10,000.00 Net...
Consider recent financials for Ellie's Essentials LLC:
Balance Sheet
2018
2017
Current Assets
$11,438.00
$10,000.00
Net PPE
$31,000.00
$30,000.00
Total Assets
$42,438.00
$40,000.00
Current Liabilities
$8,736.00
$8,000.00
Long-term debt
$12,728.00
$12,000.00
Total Liabilities
$21,464.00
$20,000.00
Shareholder Equity
$20,974.00
$20,000.00
Liabilities and Equity
$42,438.00
$40,000.00
Income Statement
2018
2017
SALES
$11,000.00
$10,000.00
COGS
$4,400.00
$4,000.00
GROSS PROFIT
$6,600.00
$6,000.00
S&A
$1,100.00
$1,000.00
Depreciation
$550.00
$500.00
EBIT
$4,950.00
$4,500.00
INTEREST
$1,272.00
$1,200.00
EBT
$3,678.00
$3,300.00
TAXES (36.00%)
$1,324.08
$1,188.00
NET INCOME
$2,353.92...
Consider the following recent financials for XYZ Corporation: Income Statement Balance Sheet Sales 73,802 Assets 209,087...
Consider the following recent financials for XYZ
Corporation:
Income Statement
Balance Sheet
Sales
73,802
Assets
209,087
Debt
38,278
Costs
44,281
Equity
170,809
EBIT
29,521
Taxes @ 38%
11,218
Total
209,087
Total
209,087
Net Income
18,303
Assets and costs are proportional to sales. Debt and equity are
not. A dividend of $2,907 was paid, and the company wishes to
maintain a constant payout ratio. Next year’s sales are projected
to grow by 25%.
What is the pro-forma value for equity?...
Consider the following recent financials for XYZ Corporation: Income Statement Balance Sheet Sales 63,252 Assets 122,852...
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Income Statement
Balance Sheet
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Assets
122,852
Debt
28,164
Costs
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Equity
94,688
EBIT
25,301
Taxes @ 38%
9,614
Total
122,852
Total
122,852
Net Income
15,687
Assets and costs are proportional to sales. Debt and equity are
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Balance Sheet April 30 (in thousands of dollars) 2019 2018 2017 Assets: Current assets $ 1,700...
Balance Sheet
April 30
(in thousands of dollars)
2019
2018
2017
Assets:
Current assets
$ 1,700
$1,120
$1,544
Plant and equipment (net)
8,110
7,830
5,404
Other assets
1,004
695
772
Total assets
$10,814
$9,645
$7,720
Liabilities and Stockholders' Equity:
Current liabilities
$ 950
$ 880
$ 772
Long-term liabilities
2,023
1,591
1,544
Capital stock ($10 par)
4,600
4,600
3,000
Paid-in capital in excess of par
770
770
386
Retained earnings
2,471
1,804
2,018
Total liabilities and
stockholders' equity
$10,814
$9,645
$7,720
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Balance Sheet
As at Dec 31 2017 and 2018
Carl’s Jr Restaurants
2017
2018
Current Assets:
Cash $210,000,000
$215,000,000
Accounts Receivables
355,000,000
310,000,000
Inventory
507,000,000 328,000,000
Total Current
Assets
$1,072,000,000 $853,000,000
Long-Term Assets:
Net Equipment, Furniture,
Fixtures
$6,085,000,000 $6,527,000,000
Total
Assets
$7,157,000,000 $7,380,000,000
Current Liabilities:
Accounts
Payable $207,000,000
$298,000,000
Notes
Payable
$1,715,000,000 $1,427,000,000
Total Current
Liabilities
$1,922,000,000 $1,725,000,000
Long-term
Liabilities
$1,987,000,000 $2,308,000,000
Owners’ Equity:
Common stock plus Capital Surplus
$1,000,000,000 $1,000,000,000
Retained
Earnings
2,248,000,000 ...
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