Explain valuation method for pharmaceutical laboratory share
We were assigned a valuation of a pharmaceutical laboratory’ shares. Which valuation method is further convenient?
Expert
Basically, you must use the discount of expected flows. After doing this valuation you can compute some ratios and compare them with other companies by the sector to see when they make sense.
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XYZ Company is planning to acquire a machine which will cost $200,000, that will last for 4 years. The company employs straight-line depreciation. The tax rate of XYZ is 35% and the proper discount rate in this situation is 12%. (A
Is this possible to use different WACCs within order to discount each year’s flows? In which cases?
Benefits of working capital requirement estimation: • Helps to judge the efficiency of utilization of working capital in generation of sales • Cost of capital aspect
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