Problemcompany detox is a private company that designs, Ask an Expert

Finance

Problem:

Company Detox, is a private company that designs, manufactures and distributes certain consumer products. In this fiscal year, Detox had revenues of $325M and earnings of $15M. Detox Company has filed a registration statement with the SEC for its IPO. If the industry average Price/Earnings ratio and Price/Revenues ratio for the recent fiscal year was 21.2 and 0.9 respectively.

Assuming Detox will issue 20M shares and using both ratios, estimate the possible range of the IPO price for Detox Company.

$10.26-$15.90

$14.63-$15.90

$10.26-$20.20

$18.01-$20.2

Explain comprehensively and show all work.

View complete question

Basic Finance, Finance

Category:- Basic Finance
Reference No.:- M91147298

Have any Question?Write your Review or question?

Related Questions in Basic Finance

What is the present value of a bond with a par value of

What is the present value of a bond with a par value of $1,000 and a 4.5% coupon rate that is paid semi-annually for 10 years at 5% interest? (round to the nearest dollar)

Question - netphone inc expects the following ucfbt 1

Question - Netphone Inc. expects the following: UCFBT= $1 million in perpetuity from the beginning of year 3 there is no income prior to that. Ignore loss carryovers for taxes. Tax rate is 50%, amount of debt = 0 Rzero= ...

We are evaluating a project that costsnbsp691200 has an

We are evaluating a project that costs $691,200, has an eight-year life, and has no salvage value. Assume that depreciation is straight-line to zero over the life of the project. Sales are projected at 85,000 units per y ...

Some managers focus on the bottom line which is the net

Some managers focus on the bottom line, which is the net income. What are some potential problems associated with such a view. Please help me by providing an historical example of a business or manager that suffered from ...

Would you pay 23 for a share of common stock that just paid

Would you pay $23 for a share of common stock that just paid a $1.65 dividend, its expected growth rate is 4% and your required return is 11%?

How you will adjust your small business cash budget to

How you will adjust your small business cash budget to manage contingencies (such as emergencies and market shifts) as well as product and distribution shifts?

Question - sports and leisure - the daytona 500 often

Question - Sports and Leisure - The Daytona 500, often referred to as The Great American Race, is a spectacular sporting event, complete with a pre-race show. Jimmie Johnson won this race in 2013, when the mean speed per ...

What are the effects of coupon rate to the sensitivity of a

What are the effects of coupon rate to the sensitivity of a bond price and to changes in interest rates?

What are the steps to protecting health information during

What are the steps to protecting health information during Electronic Health Records implementation?

The reports delivered to those engaged in carrying out or

The reports delivered to those engaged in carrying out or managing the project should be timed to allow control to be exercised before completion of the task in question. Describe exception reports versus special analysi ...

4,153,160 Questions Asked
13,132 Experts
2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

Recent Questions

Ask Basic Finance Expert