Sample Precedent Transactions Analysis of Elite Branding Consultants
The following section provides a step-by-step example of how a precedent transactions analysis works in practice, ultimately establishing a valuation range for Elite Branding Consultants, a company that Superior Products is hoping to assess in advance of a potential merger.
Elite Branding Consultants is a brand development company that plans and implements strategies for retailers and fashion designers. Following are Elite’s most recent income statement and balance sheet data:
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Elite Branding Consultants |
|
|
Consolidated Statements of Income |
|
|
LTM |
|
|
Net Revenue |
$720.00 |
|
Cost of Goods Sold (COGS) |
355.00 |
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Gross Profit |
$365.00 |
|
Salaries, Wages, and Benefits |
150.00 |
|
Marketing, General and Administrative |
100.00 |
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Depreciation and Amortization |
20.00 |
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Total Operating Expenses |
$270.00 |
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Operating Income |
$95.00 |
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Interest Expense |
9.00 |
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Income Before Taxes |
$86.00 |
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Income Taxes |
32.25 |
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Net | |