Forum Search: capital markets
Re: Capital Leases(Liab) and Marketable Securities
In what context are you asking what should be done with these two items?
In what context are you asking what should be done with these two items?
Re: Cash
Premium should not included because once private, there is a lack of liquidity discount. In addition, if IPO'ing as an exit, the markets are priced without control premium. What is the point of "cash conversation ratio"? To calculate actual cash generated vs Net Income? For sure, we are skeptical... Read More
Premium should not included because once private, there is a lack of liquidity discount. In addition, if IPO'ing as an exit, the markets are priced without control premium. What is the point of "cash conversation ratio"? To calculate actual cash generated vs Net Income? For sure, we are skeptical... Read More
Re: Cash
1) Regarding taxes - your tax rate utilized in theory represents effective tax rate which already incorporates income tax holiday or other abatements. Conceptually, you got the idea - just make sure your FCFF is pre-capital structure, including taxes - Just pretend there is no debt and model out FCF... Read More
1) Regarding taxes - your tax rate utilized in theory represents effective tax rate which already incorporates income tax holiday or other abatements. Conceptually, you got the idea - just make sure your FCFF is pre-capital structure, including taxes - Just pretend there is no debt and model out FCF... Read More
Re: Cash
Thanks. Got your point on FCFF and agree. But sometimes its not just capital structure affecting the actual tax. as sometimes the operations itself as well like income tax holiday or final tax rule. So getting a "pseudo" tax using EBT * tax rate is far from actual tax. Is FCFF being use that much in... Read More
Thanks. Got your point on FCFF and agree. But sometimes its not just capital structure affecting the actual tax. as sometimes the operations itself as well like income tax holiday or final tax rule. So getting a "pseudo" tax using EBT * tax rate is far from actual tax. Is FCFF being use that much in... Read More
Re: Cash
If the underfunded pension amount is material, then you treat it like debt - that is TEV of your target company stays the same but the equity value component is lower - in other words, the size of the pie stays the same but the slices of the pie are altered. The logic is that you must replenish this... Read More
If the underfunded pension amount is material, then you treat it like debt - that is TEV of your target company stays the same but the equity value component is lower - in other words, the size of the pie stays the same but the slices of the pie are altered. The logic is that you must replenish this... Read More
Re: Cash
Recall our conversation that we adjust for capital structure in valuation at the END of the DCF valuation. FCFE, similar to PE is the root of all evil in valuation. Since the point of FCFF is to calculate pre-capital structure cash flow, we want to make sure that the taxes properly reflect this logi... Read More
Recall our conversation that we adjust for capital structure in valuation at the END of the DCF valuation. FCFE, similar to PE is the root of all evil in valuation. Since the point of FCFF is to calculate pre-capital structure cash flow, we want to make sure that the taxes properly reflect this logi... Read More
Re: EV/EBITDA vs. P/E
Please note that we would highly recommend avoiding use of the “EV” acronym since it is misleading – equity value or enterprise value? We always recommend use of TEV for [Total] Enterprise Value. Regarding your actual question, generally TEV/EBITDA will be lower than PE multiples due to sim... Read More
Please note that we would highly recommend avoiding use of the “EV” acronym since it is misleading – equity value or enterprise value? We always recommend use of TEV for [Total] Enterprise Value. Regarding your actual question, generally TEV/EBITDA will be lower than PE multiples due to sim... Read More
Re: Cash
If a true asset sale, then correct, you are only purchasing certain assets and liabilities. Each of those would be valued separately to arrive at "fair" value. The analysis basically becomes build the asset vs. buy the asset. You could also look at it from an TEV perspective based on the nature of t... Read More
If a true asset sale, then correct, you are only purchasing certain assets and liabilities. Each of those would be valued separately to arrive at "fair" value. The analysis basically becomes build the asset vs. buy the asset. You could also look at it from an TEV perspective based on the nature of t... Read More
Re: Cash
Thanks again. I understand. But for an asset-sale type of transaction wherein target will sell asset only without working capital. Any project loan will include a working capital line/revolver, so we must make sure we are paying the "fair" multiple for this type of asset on a going concern basis. At... Read More
Thanks again. I understand. But for an asset-sale type of transaction wherein target will sell asset only without working capital. Any project loan will include a working capital line/revolver, so we must make sure we are paying the "fair" multiple for this type of asset on a going concern basis. At... Read More
If we are trying to determine Mervyn's value on the same terms as other retailers, why would we net out A/R when we did not do that for any other deal or trade comp? If Mervyn is valued after the sale of receivables to GE Capital, then the $1,650 million equity value is inappropriate because it is t... If we are trying to determine Mervyn's value on the same terms as other retailers, why would we net out A/R when we did not do that for any other deal or trade comp? If Mervyn is valued after the sale of receivables to GE Capital, then the $1,650 million equity value is inappropriate because it is the aggregate of two separate transactions Read More