Principles of Private Firm Valuation

63

TABLE 4.6

Financial Information of Peer Firms

Reported Actual Net Debt-to

Levered Cost Cost of

Income

Implied

g:

Company Unlevered Equity-

Size

of Equity Equity:

Profit

P/S Gordon Adjusted Estimated

Name

Beta

Ratio

Premium

Capital

90/10

Margin

Ratio

Model

Implied

g

P/S

Cuno Inc.

0.4199

0.02

0.43%

8.40%

8.57%

9.30% 2.753

4.86%

3.00%

2.50

Esco

Technologies,Inc.

0.4157

0.02

0.43%

8.37%

8.54%

6.74% 1.613

4.02%

2.00%

1.60

Flow

InternationalCorp.

0.4365

2.26

3.16%

15.60%

11.43%

−48.58% 0.272

−246.78%

NM

†

NM

Nordson Corp.

0.3974

0.19

0.34%

8.45%

8.13%

5.27% 1.949

5.59%

4.60%

2.11

Pall Corp.

0.3846

0.18

0.34%

8.33%

8.20%

6.40% 1.857

4.72%

3.00%

1.85

Peerless

Manufacturing Co.

0.4512

0.00

4.21%

12.38%

12.60%

−0.55% 0.458

13.74%

NM

NM

Taylor Devices,

Inc.

0.4617

0.85

4.21%

14.21%

12.68%

2.53% 0.485

8.55%

8.00%

0.66

TB Woods Corp.

0.4512

0.65

4.21%

13.68%

12.60%

−0.37% 0.407

14.73%

NM

NM

Average*

11.18%

10.35%

6.05% 1.22

5.55%

4.12%

1.75

Tentex

15.00%

15.00%

10.79%

3.00%

3.00%

1.36

‡

*Average based on positive values only.

†Not meaningful.

‡Discounted cash flow multiple.