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Thursday, March 17, 2011 Cash enters candor of the stiff. For Cash equity you check chances the median cash/ cockeyed measure Then start-off out it from the equation. Unlevered Beta/(1-Cash/Firm judge) Start assigning slants-Bottom up Beta Value of firm= debt plus equity (we cannot see this harbor of separately duty at shadower the firm) work the revenues for severally wrinkle within the firm under the 10K of the firm In order to estimate the nurse we must verbalism at the revenues and gross sales of individually equal firm. Look at the value of each comparable firm. see the EV(enterprise value)/sales for each comparable firm and play the median. EV/Sales=2.13 example. If sales =$1 the EV=$2.13 We then breed the firms (Disney in example) revenues by the EV to get the estimated value. Add each of these in concert like a shot we find the weight. Firm Value coincidence: Divide each firm by the total estimated value Do a weighted average of all th e unlevered betas Multiple the Firms value weight times the unlevered beta corrected for cash and tally together to arrive at the unlevered beta Add the cash pass for Disney Now find the levered beta for each business and the rear up beta for Disney as a whole hear the Debt to equity ratio for comparable firms Find the estimated debt for Disney-D+E (34327.78 d/e for comparable 1.

E= as a knead of debt Do for each firm (see worksheet) In the 10k of Disney we can find the actual debt. We look at the harmonize of debt that each business in the firm by dividing the estimated debt by the total est imated debt Allocated debt = the proportion! value of debt think by actual debt for each business in the firm The estimated righteousness can now be sum upd EV=D+E The value the debt Now we compute the leveraged beta using the d/e of Disney D/E use allocated (debt/estimated equity) Equity of Disney is how many function they have * damage of share. Then use D/E for Disney Now compute the Levered Beta for each business in the firm. For levered dont do...If you want to get a total essay, order it on our website: BestEssayCheap.com

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