What Price for the whole business would YOU pay? Then tell me the per share price. The company had operations for 25 years prior to going public. The company’s stock price will under perform the market (SPY) about 1/3 of the time over the next forty years.
| BUSINESS XXX? | 1974 | 1973 | 1972 | 1971 | 1970 |
| Cash | $2,238,263 | $2,168,224 | |||
| Working capital | 27,132,580 | 16,796,897 | |||
| LT Debt ** | 10,578,269 | 5,065,567 | |||
| Shareholders’ Equity | 30,734,128 | $24,753,623 | |||
| Outstanding Shares | 6,542,250 | 6,512,950 | |||
| Net Sales | $167,560,892 | $124,889,141 | 78,014,164 | 44,286,012 | 30,862,659 |
| Income Bef. Taxes | 11,883,754 | 8,917,188 | 5,569,027 | 3,170,599 | 2,198,764 |
| Pro-forma Net Income | $6,158,520 | 4,591,469 | 2,907,354 | 1,651,599 | 1,187,764 |
| EPS | $0.93 | $0.70 | $0.47 | $0.30 | $0.23 |
| Units in operation | 78 | 64 | 51 | 38 | 32 |
| ROE | 38.67% | 36.02% | |||
| ** Co. has a $12 mil. Credit line renewed yearly of which it has borrowed $4 mil. | |||||
| Assume Co. needs all cash for operations | |||||
| Assume strong growth for 40 years.You need a required rate of return of 15% | |||||
XXX Company Worksheet (Excel Spreadsheet)
Can you guess the actual name of the company?
To give you some historical perspective of 1974 see:A Study of Market History through Graham Babson Buffett and Others
Winner gets a date with my Ex: http://youtu.be/E55ni_xc4ww (PLEASE do NOT click on the link unless you win the prize)
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