Cost Management: A Strategic Emphasis 7th Edition by Edward Blocher,David Stout ,Paul Juras,Gary Cokins

Exercise 49

Using the information in Exercise 20-40 for Yum! Brands, determine the valuation of the company at the end of 2013 using each of the following three methods. Assume earnings and cash flows for the coming 10 years are equal to the earnings and cash flows in 2013; the appropriate free cash flow multiple is 23.4; and the earnings multiple is 21.7.
a. Market capitalization
b. Enterprise value
c. Free cash flow multiple