Develop a market-based valuation for Kohler stock by:Creating valuation multiples for the comparable companies (Exhibit 7b)Price to earnings (EBITDA)Price to salesApplying those valuation multiples to Kohler to obtain two valuations for Kohler (one based on price/ sales and one based on price / earnings) from each comparable company.Select a value for Kohler overall from the median of these results.Divide by the number of shares for Kohler to determine the price per share based on a market value.Develop a discounted cash flow analysis of the value of Kohler stock by:Calculate the annual historic and projected net cash from operations and investment.For this exercise, use an 8% discount rate.Calculate a terminal value by:Computing a compound annual growth rate for:Kohler actual net cash flowKohler projected net cash flowKohler total (actual & projected) net cash flowApplying your choice of CAGR to the final year’s net cash flow.Discounting that stream into perpetuity at the discount rate from above.Write a brief opinion on the value of a privately-held share of Kohler giving:The date of the valuation.Your choice of a value.The basis for your selection. (Your reasons for concluding what you did.)Exhibit 3a – Kohler Co. Historical Balance Sheets
2 peer responses – due in 4 hours
Guided Response: Respond in a substantive way to at least two of your peers. Choose at least one point from your peer’s response that impacted your thinking on this subject, and explain why and how that particular comment resonated with you or caused you to think in a different way. Compare the implications for […]