jcole21

Thanks bpdulog. A few followups:
14. I did the same exact thing as you and determined that EBIT/Sales is less relevant to credit worthiness than LTD/Capital. Going back to the original question, have you figured out why they calculate Operating Income/Sales as EBITDA/Sales?
25. Yes, that’s positive roll yield. But that doesn’t confer with their statement: “Positive roll yield occurs when the futures price is above the full carry price.”
45. Does the calculation of interest change at all if it is not an interest only loan?
60. Another way you can think of this is to say that to use DDM, dividends should be consisntent with NI. But NI should be consistent with cash flow, and FCFE is a measure of CF. Additionally, NI is a component of FCFE. So avoid DDM because dividends are not consistent with NI or CF.