Factors affecting the Pe Multiple Flashcards
1
Q
being an unlisted company, the shares are less marketable
A
-1.5
2
Q
loss of the family management may affect short term profitability;
A
-1
3
Q
legal law suit
A
-1
4
Q
the company has experienced an inconsistent trading history (turnover fluctuates significantly) and volatility in earnings
A
increases Romm
-1
5
Q
premium for control (55% shareholding to be acquired);
A
+1
6
Q
Support of the PE Multiple factors using Ratio analysis
-return on equity
-has enormous potential for gearing;
A
+1
7
Q
The negative factors outweigh the positive factors.. bla bla bala
A
Conclusion
8
Q
. We believe that it would be in your interests to make an opening offer in the region of R6m for the shares
A
Recommendation(Just command of English)
