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10 June 2008 |
183
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Valuation Details
| Member: | TheCrunchBlog |
| On: | 26 Jun 2008 |
| Views: | 183 |
| Comments: | 1 |
| Updated: | 43 minutes ago |
| Ticker: | GOOG |
| Market: | NASD |
This valuation is part of this blog post:
http://blog.valuecruncher.com/2008/06/a-scenario-approach-to-valuing-google-goog/
3. Black Swan – where Google’s internal activities create a new growth business similar in value to Salesforce.com. The new business grows from US$250 million in revenues in 2009 to US$1.5 billion in 2012 and from $250m in losses to 50% EBIT margins in the same period. To reflect this we have increased 2009 revenues by US$250 million and 2010 revenues by US$500 million. We have reduced the 2009 EBITDA to 39%. We have also lifted the terminal growth to 6.65%. This scenario has a valuation of US$507.85 per share. This is 6.4% below the current share price and 5.4% above our base case valuation. Google creating a new business of the value of Salesforce.com adds just under US$26 to our base case share price.