East Coast Yachts wants to make its own engines and to do that they may purchase Ragan Motors. Per the Closing Case at t
Posted: Fri Mar 04, 2022 9:37 am
East Coast Yachts wants to make its own engines and to do that
they may purchase Ragan Motors. Per the Closing Case at the end of
Chapter 6, Larissa asked Dan to determine the value per share of
Ragan stock in anticipation of acquiring them. Turns out that
Nautilus Marine Engines had a write off last year. Without this
write off, the Earnings per Share would have been $2.05. All other
data reported in the Closing Case is unchanged,
14.00%
To determine an accurate estimate of the value of Ragan's stock
based on this information, should the actual EPS with the write off
be used or the EPS without the write off?
Assume Ragan's growth rate slows to the industry average in five
years, and given your answer to the previous question, what future
ROE does this imply?
What does the Ragan PE ratio in comparison with the Industry PE
ratio indicate concerning a decision to purchase Ragan by East
Coast? Is it a good idea or not, and why?
they may purchase Ragan Motors. Per the Closing Case at the end of
Chapter 6, Larissa asked Dan to determine the value per share of
Ragan stock in anticipation of acquiring them. Turns out that
Nautilus Marine Engines had a write off last year. Without this
write off, the Earnings per Share would have been $2.05. All other
data reported in the Closing Case is unchanged,
14.00%
To determine an accurate estimate of the value of Ragan's stock
based on this information, should the actual EPS with the write off
be used or the EPS without the write off?
Assume Ragan's growth rate slows to the industry average in five
years, and given your answer to the previous question, what future
ROE does this imply?
What does the Ragan PE ratio in comparison with the Industry PE
ratio indicate concerning a decision to purchase Ragan by East
Coast? Is it a good idea or not, and why?