Edelman Engines has $18 billion in total assets- of which cash and equivalents total $120 million. Its balance sheet shows $2.7 billion in current liabilities of which the notes payable balance totals $1.16 billion. The firm also has $9 billion in long-term debt and $6.3 billion in common equity. It has 300 million shares of common stock outstanding, and its stock price is $26 per share. The firm's EBITDA totals $1.248 billion. Assume the firm's debt is priced at par, so the market value of its debt equals its book value. What are Edelman's market/book and its EV/EBITDA ratios? Do not round intermediate calculations. Round your answers to two decimal places. M/B: EV/EBITDA:
Edelman Engines has $18 billion in total assets- of which cash and equivalents total $120 million. Its balance sheet shows $2.7 billion in current liabilities of which the notes payable balance totals $1.16 billion. The firm also has $9 billion in long-term debt and $6.3 billion in common equity. It has 300 million shares of common stock outstanding, and its stock price is $26 per share. The firm's EBITDA totals $1.248 billion. Assume the firm's debt is priced at par, so the market value of its debt equals its book value. What are Edelman's market/book and its EV/EBITDA ratios? Do not round intermediate calculations. Round your answers to two decimal places. M/B: EV/EBITDA:
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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Edelman Engines has $18 billion in total assets- of which cash and equivalents total $120 million. Its balance sheet shows $2.7 billion in current liabilities of which the notes
payable balance totals $1.16 billion. The firm also has $9 billion in long-term debt and $6.3 billion in common equity. It has 300 million shares of common stock outstanding, and its
stock price is $26 per share. The firm's EBITDA totals $1.248 billion. Assume the firm's debt is priced at par, so the market value of its debt equals its book value. What are
Edelman's market/book and its EV/EBITDA ratios? Do not round intermediate calculations. Round your answers to two decimal places.
M/B:
EV/EBITDA:
Expert Solution
Step 1
1. M/B = Market Value Of Equity Share / Book Value Of Equity share
2. Ev / EBITDA = Enterprise Value / Earning before income Tax Depreciation and Amortization
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