标题: Reading 46: Private Company Valuation-LOS a 习题精选 [打印本页]
作者: 土豆妮 时间: 2011-3-21 13:48 标题: [2011]Session 12-Reading 46: Private Company Valuation-LOS a 习题精选
Session 12: Equity Investments: Valuation Models
Reading 46: Private Company Valuation
LOS a: Compare and contrast public and private company valuation.
An analyst is examining three companies. Given the information below, which of them is most likely to be a private firm?
| Firm |
Number of Years in Operation |
Market Capitalization |
Required Return for Common Stock |
| A |
12 years |
$1,324.8 million |
14.8% |
| B |
4 years |
$1,313.9 million |
18.3% |
| C |
19 years |
$2,231.0 million |
16.4% |
The firm most likely to be a private firm is Firm B. Compared to public firms, private firms are less mature (4 years for Firm B), smaller (market cap of B is $1,313.9 million), and have higher required returns (required return for B is 18.3%).
作者: 土豆妮 时间: 2011-3-21 13:48
An analyst is examining the stock of three companies. Given the information below, which of them is most likely to be the stock of a private firm?
| Firm |
Restrictions on Sale of Stock? |
DLOM |
Stock Ownership of 5 Largest Owners |
| A |
Yes |
0% |
28% |
| B |
No |
5% |
35% |
| C |
Yes |
15% |
64% |
The stock most likely to be that of a private firm is Firm C. Compared to public stock, private firm stock often has agreements that prevent shareholders from selling, is less liquid (discounts for lack of marketability (DLOM) of C is 15%), and control is usually concentrated in the hands of a few shareholders (stock ownership of largest owners of Firm C is 64%).
作者: 土豆妮 时间: 2011-3-21 13:48
Which of the following statements most accurately describes the difference between private and public firm managers?
|
A) |
Because managers in a public firm are often paid with incentive compensation, public managers may take a longer term view than private managers. | |
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B) |
Although managers in a public firm are often paid with incentive compensation, public managers may take a shorter term view than private managers because shareholders often focus on the short-term. | |
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C) |
Because managers in a private firm are concerned with having the firm go public, private managers may take a shorter term view than public managers. | |
Although managers in a public firm are often paid with incentive compensation such as options, shareholders often focus on short-term measures such as quarterly earnings and the consistency of such. Management may therefore take a shorter term view than they otherwise would. Private firms should be able to take a longer term view.
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