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Both companies have an operating tax rate of 25 percent and

You are valuing multiple steady-state companies in the same industry. Company A is projected to earn $160 in EBITA, grow at 2 percent per year, and generate ROICs equal to 15 percent. Company B is projected to earn $100 in EBITA, grow at 6 percent per year, and generate ROICs equal to 10 percent. Both companies have an operating tax rate of 25 percent and a cost of capital of 10 percent. What are the etnerprise-value-to-EBITA multiples for both companies? Does higher growth lead to a higher multiple in this case?

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Finance Basics: Both companies have an operating tax rate of 25 percent and

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Finance Basics: Both companies have an operating tax rate of 25 percent and

Reference No:- TGS0623045

Have a Question? (oR Write a Review)

Recent Questions Asked Finance Basics

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Finance Basics: Both companies have an operating tax rate of 25 percent and

Reference No:- TGS0623045

Recent Questions Asked Finance Basics

Q : A colleague argues that this is too conservative as

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Q : If the voltage across the current through the series

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Q : Design both inverters with an on voltage of 07v and a dc

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