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10 June 2008 |
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Valuation Details
| Member: | TheCrunchBlog |
| On: | 18 Jun 2008 |
| Views: | 143 |
| Comments: | 1 |
| Updated: | 1 minute ago |
| Ticker: | TWX |
| Market: | NYSE |
This valuation is part of the following blog post:
http://blog.valuecruncher.com/2008/06/thinking-about-valuation-of-traditional-media/
Time Warner grew revenues from US$39.5 billion in 2003 to US$46.5 billion in 2007 – a 4% compound annual growth rate. Our assumptions of revenues for the next three years are US$48.0 billion in 2008 growing to US$52.0 billion in 2010. We have projected EBITDA margins increasing from 22% in 2008 to 25% in 2010. We have used a terminal growth rate of 2%. We calculated this terminal growth rate based on year three growth of 4% dropping to a 2% stable growth rate by year 10. We used a terminal capital expenditure number of US$4.5 billion. We have used a WACC (discount rate) of 8.5%.