Scotts Miracle-Gro is the world’s leading supplier and marketer of do-it-yoursel

Question

Scotts Miracle-Gro is the world’s leading supplier and marketer of do-it-yourself lawn and garden products and is located in Marysville, Ohio. Although Scotts dominates many of its chosen markets, its profit margins are mediocre. Use the following information on Scotts and five other similar companies to value Scotts’s
common stock on November 1, 2007.

Book value interest-bearing debt

Scotts Miracle-Gro ($ millions)
  
Net income $ 113.4
Number of common share in millions 63.9
Earnings before interest and tax $ 156
Tax rate 40%
Book value of equity $ 479.3
Book value interest-bearing debt $1,118

This is question 10 from "Analiysis for Financial mamagers." The remaining information required to answer this question can be found here...

http://www.chegg.com/homework-help/scotts-miracle-gro-world-s-leading-supplier-marketer-lawn-ga-chapter-9-problem-10p-solution-9780078034688-exc

Explanation / Answer

value of common stock of one share of scott= 479.3/ 63.9 = $ 7.5/ share

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