Suppose Rocky Brands has earnings per share of $2.19 and EBITDA of $31.2 million. The firm also has 4.8 millionshares outstanding and debt of $135 million (net of cash). You believe Jared's Outdoor Corporation is comparable toRocky Brands in terms of its underlying business, but Jared's has no debt. If Jared's has a P/E of 13.1 and anenterprise value to EBITDA multiple of 7.9, estimate the value of Rocky Brands stock using both multiples. Whichestimate is likely to be more accurate?Rocky Brands' stock value by using the P/E ratio is $The value of Rocky Brands by using the P/E ratio is $per share. (Round to two decimal places.)million. (Round to one decimal place.)

Enterprise value refers to the firm's total worthiness. In other words, it is the price at which the…

Suppose Rocky Brands has earnings per share of $2.19 and EBITDA of $31.2 million. The firm also has 4.8 shares outstanding and debt of $135 million (net of cash). You believe Jared's Outdoor Corporation is comp Rocky Brands in terms of its underlying business, but Jared's has no debt. If Jared's has a P/E of 13.1 and enterprise value to EBITDA multiple of 7.9, estimate the value of Rocky Brands stock using both multiples. estimate is likely to be more accurate? Rocky Brands' stock value by using the P/E ratio is $ The value of Rocky Brands by using the P/E ratio is $ per share. (Round to two decimal places.) million. (Round to one decimal place.)

Suppose Rocky Brands has earnings per share of $2.19 and EBITDA of $31.2 million. The firm also has 4.8 shares outstanding and debt of $135 million (net of cash). You believe Jared's Outdoor Corporation is comp Rocky Brands in terms of its underlying business, but Jared's has no debt. If Jared's has a P/E of 13.1 and enterprise value to EBITDA multiple of 7.9, estimate the value of Rocky Brands stock using both multiples. estimate is likely to be more accurate? Rocky Brands' stock value by using the P/E ratio is $ The value of Rocky Brands by using the P/E ratio is $ per share. (Round to two decimal places.) million. (Round to one decimal place.)

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter3: Evaluation Of Financial Performance

Section: Chapter Questions

Problem 8P

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