Use the Information for the Question(s)below

question 25

Essay

Use the information for the question(s)below.
During the most recent fiscal year,KD Industries had revenues of $400 million and earnings of $30 million.KD has filed a registration statement with the SEC for its IPO.Before it is offered,KD's investment bankers would like to estimate the value of the company using comparable companies.The investment bankers have assembled the following information based on data for other companies in the same industry that have recently gone public.In each case,the ratios are based upon the IPO price.
-Based upon the price/earnings ratio,what would be a reasonable value for KD?

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Definitions:

SEDAR

SEDAR (System for Electronic Document Analysis and Retrieval) is a filing system developed for the Canadian securities industry to facilitate the electronic filing and public dissemination of securities information.

Investment Advisors

Professionals who provide advice on investment decisions, often related to securities such as stocks, bonds, and mutual funds.

Registration Requirement

A legal or regulatory condition mandating the official recording of an item, event, or transaction before it becomes effective or valid.

Financial Market Commentators

Individuals or entities that provide analysis, opinions, or commentary on market trends and financial news.