Lumen Analytics sells data-analytics software to mid-sized companies. A client is weighing an investment and wants to know what the whole business is valued at, and whether that looks rich next to its peers.
- Share price
- $48.00
- Basic shares
- 120M
- Options, tranche A
- 8M at $20 strike
- Options, tranche B
- 5M at $40 strike
- Options, tranche C
- 4M at $60 strike
- RSUs
- 3M
- Convertible bond
- $300M, converts at $40/share
- Other debt
- $500M
- Preferred stock
- $50M
- Noncontrolling interest
- $30M
- Cash
- $400M
- Equity investments (not consolidated)
- $60M
- LTM revenue / EBITDA
- $900M / $180M
- Peer medians
- 6.5x revenue, 30.0x EBITDA
Your assignment
Work out Lumen's diluted share count, equity value and enterprise value, then compare its multiples with peers. Is it cheap or expensive?