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    Valcon 2

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    Kim Bihag
    This document discusses tools used in asset-based valuation and provides examples for 3 companies - Hats and Shoes Corp, Electricute Inc., and Keep and Carry Inc. It shows financial details like revenue, income, cash flows, capital expenditures, and enterprise/equity values for each company over multiple years. It also defines the compounded annual growth rate formula and shows enterprise value scenarios using different weighted average cost of capital percentages.

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    Valcon 2

    Uploaded by

    Kim Bihag
    102 views153 pages
    This document discusses tools used in asset-based valuation and provides examples for 3 companies - Hats and Shoes Corp, Electricute Inc., and Keep and Carry Inc. It shows financial details like revenue, income, cash flows, capital expenditures, and enterprise/equity values for each company over multiple years. It also defines the compounded annual growth rate formula and shows enterprise value scenarios using different weighted average cost of capital percentages.

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    valcon 2

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    This document discusses tools used in asset-based valuation and provides examples for 3 companies - Hats and Shoes Corp, Electricute Inc., and Keep and Carry Inc. It shows financial details like revenue, income, cash flows, capital expenditures, and enterprise/equity values for each company over multiple years. It also defines the compounded annual growth rate formula and shows enterprise value scenarios using different weighted average cost of capital percentages.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
    Download as xlsx, pdf, or txt
    102 views153 pages

    Valcon 2

    Uploaded by

    Kim Bihag
    This document discusses tools used in asset-based valuation and provides examples for 3 companies - Hats and Shoes Corp, Electricute Inc., and Keep and Carry Inc. It shows financial details like revenue, income, cash flows, capital expenditures, and enterprise/equity values for each company over multiple years. It also defines the compounded annual growth rate formula and shows enterprise value scenarios using different weighted average cost of capital percentages.

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    © All Rights Reserved
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    You are on page 1of 153

    Chapter 3: Tools Used in Asset-Based Valuation

    Problems

    3.1 Hats and Shoes Corp.

    Year 1 Year 2
    Units 60 69
    Price 50.00 50.00
    Revenue 3,000.00 3,450.00

    Year 1 Year 2
    Revenue 3,000.00 3,450.00
    Income Margin 25% 25%
    Revenue 750.00 862.50

    CAGR =

    Compounded Annual Growth Rate 12%

    3.2 Electricute Inc.

    Year 1 Year 2
    Net Cash Flows 45,000,000.00 49,500,000.00
    Less: Capital Expenditure (250,000,000.00)
    Terminal Value
    Free Cash Flow- Firm (205,000,000.00) 49,500,000.00
    Enterprise Value ₱445,632,389.97

    Enterpise Value 445,632,389.97


    Less: Outstanding Loans (125,000,000.00)
    Equity Value 320,632,389.97

    3.3 Keep and Carry Inc.

    Year 1 Year 2
    Net Cash Flows 1,250,000,000.00 1,375,000,000.00
    Less: Capital Expenditure (15,000,000,000)
    Terminal Value
    Free Cash Flow- Firm (13,750,000,000) 1,375,000,000.00
    Enterprise Value 1,244,924,176

    Enterpise Value 1,244,924,176.32


    Less: Outstanding Loans -
    Equity Value 1,244,924,176.32

    Enterprise Value Scenar WACC


    1,244,924,176.32 14.50%
    2,136,628,494.98 12.50%
    3,139,349,223.72 10.50%
    Year 3 Year 4 Year 5
    79 91 105
    50.00 50.00 50.00
    3,967.50 4,562.63 5,247.02

    Year 3 Year 4 Year 5


    3,967.50 4,562.63 5,247.02
    25% 25% 25%
    991.88 1,140.66 1,311.75

    Year 3 Year 4 Year 5


    54,450,000.00 59,895,000.00 65,884,500.00

    658,845,000.00
    54,450,000.00 59,895,000.00 724,729,500.00
    Year 3 Year 4 Year 5
    1,512,500,000.00 1,663,750,000.00 1,830,125,000.00

    18,301,250,000.00
    1,512,500,000.00 1,663,750,000.00 20,131,375,000.00
    Discount Factor
    7.5%
    Discount Factor
    14.5%

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