valuation of tesla

7/27/2019 Valuation of Tesla

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Date of valuation Sep-13 Important: Before you runCompany name Tesla There should be a check a

This year Last year

Country of incorporation United States of AmericaIndustry (US) Automotive

Industry (Global) Auto & TruckRevenues 1,328.70$ 413.26$Operating income or EBIT (216.72)$ (394.28)$ Don't adjust oInterest expense 19.83$ (0.25)$Book value of equity 629.43$ 124.70$Book value of debt 578.74$ 452.34$Do you have R&D expenses to capitalize? Yes If you want to capitalizeDo you have operating lease commitments? No If you have operating leasCash and cross holdings 201.89$ 746.06$Non-operating assets -$ -$Minority interests -$ -$Number of shares outstanding = 121.45

Current stock price = 168.76$

Effective tax rate = 0.00%Marginal tax rate = 35.00%The value drivers below:

Compounded annual revenue growth rate over next 5 ye 70.00% Target Porsche revenuesTarget pre-tax operating margin (EBIT as % of sales in y 12.50% 95th percentile: Auto induSales to capital ratio (for computing reinvestment) = 1.41 Average for USMarket numbers Year 10 ROC= 11.34%

Riskfree rate 2.75%

Initial cost of capital = 10.03% See cost of capital workshOther inputs Treated it as 60% auto, 40

Do you have employee options outstanding? YesNumber of options outstanding = 25.01 From last 10K

Average str ike price = $21.20 From last 10K

Average maturity = 3.50 From last 10KStandard deviation on stock price = 50.00% Used 80th percentile of U

In stable growth, I will assume that your firm will have a cost of capital similar to that of typical mature com

Do you want to override this assumption = Yes Mature companies generaIf yes, enter the cost of capital after year 10 = 8% Though some sectors, evI will assume that your firm will earn a return on capital equal to its cost of capital after year 10. I am assu

Do you want to override this assumption = No Mature companies find itIf yes, enter the return on capital you expect after year 1 12% But there are significant eI will assume that your firm has no chance of failure over the foreseeable future.

Do you want to override this assumption = Yes Many young, growth compIf yes, enter the probability of failure = 10% Tough to estimate but a k

What do you want to tie your proceeds in failure to? V B: Book value of capital, VEnter the distress proceeds as percentage of book or fai 50% This can be zero, if the asI will assume that your effective tax rate will adjust to your marginal tax rate by your terminal year. If you o

Do you want to override this assumption = NoI will assume that you have no losses carried forward from prior years ( NOL) coming into the valuation. If

Do you want to override this assumption = Yes Check the financial statemIf yes, enter the NOL that you are carrying over into year $1,070.00 From last 10K

Defau l t assumpt ion s .

Numbers from your base year below ( in


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this spreadsheet, go into preferences in Excel and check under Calculation optionsgainst the iteration box. If there is not, you will get circular reasoning errors.

-0.16311

erating income for leases or R&D, if you plan to use the spreadsheet option to do so. (see below)

&D, you have to input the numbers into the R&D worksheet.

s, please enter your lease commitments in the lease worksheet below and I will convert to debt

Computed numbers: Here is what your company's numbers look like, relative to industry.

If you are not working in US dollars, you should add the inflation differential to the industry averages.Company Industry (US dat Industry (Global data)

Revenue growth in the most recent year = 221.52% 42.35% 78.00%Pre-tax operating margin in the most recent year -1.64% 5.80% 5.98%Sales to capital ratio in most recent year = 1.32 1.41 1.49Return on invested capital in most recent year= 128.22% 5.77% 7.83%Standard deviation in stock prices = 59.23%Cost of capital = 6.79%

eet

% technology company for the moment

stock standard deviatons

anies (riskfree rate + 4.5%)

ly see their risk levels approach the average

n in stable growth, may have higher risk.

ing that whatever competitive advantages you have today will fade over time.

ifficult to generate returns that exceed the cost of capital

ceptions among companies with long-lasting competitive advantages.

anies fail, especially if they have trouble raising cash. Many distressed companies fail, because they have troubl

y input.

= Estimated fair value for the companyets will be worth nothing if the firm fails.

erride this assumption, I will leave the tax rate at your effective tax rate.

ou have a money losing company, you may want to override tis.

ents.

onsistent units)


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making debt payments.


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Base year 1 2 3 4

Revenue growth rate 70.00% 70.00% 70.00% 70.00%

Revenues 1,328.70$ 2,258.78$ 3,839.93$ 6,527.88$ 11,097.40$

EBIT (Operating) marg -1.64% -0.23% 1.18% 2.60% 4.01%

EBIT (Operating incom (21.86)$ (5.21)$ 45.46$ 169.63$ 445.34$

Tax rate 0.00% 0.00% 0.00% 0.00% 0.00%EBIT(1-t) (21.86)$ (5.21)$ 45.46$ 169.63$ 445.34$

- Reinvestment 659.64$ 1,121.38$ 1,906.35$ 3,240.79$

FCFF (664.84)$ (1,075.92)$ (1,736.72)$ (2,795.45)$

NOL 1,070.00$ 1,075.21$ 1,029.74$ 860.11$ 414.78$

Cost of capital 10.03% 10.03% 10.03% 10.03%

Cumulated discount factor 0.9088 0.8260 0.7507 0.6822

PV(FCFF) (604.23)$ (888.67)$ (1,303.68)$ (1,907.10)$

Terminal cash flow 3,584.25$Terminal cost of capital 8.00%

Terminal value 68,271.37$

PV(Terminal value) 27,750.37$

PV (CF over next 10 ye (14,936.06)$

Sum of PV 12,814.31$

Probability of failure = 10.00%

Proceeds if firm fails = $6,407.15

Value of operating asse 12,173.59$

- Debt 578.74$

- Minority interests -$

+ Cash 201.89$+ Non-operating assets -$

Value of equity 11,796.74$

- Value of options $3,644.97

Value of equity in com 8,151.77$

Number of shares 121.45

Estimated value /share 67.12$

Price 168.76$

Price as % of value 251.43%

Implied variablesSales to capital ratio 1.41 1.41 1.41 1.41

Invested capital 1,698$ 2,358$ 3,479$ 5,385$ 8,626$

ROIC -1.29% -0.22% 1.31% 3.15% 5.16%


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5 6 7 8 9 10

70.00% 56.55% 43.10% 29.65% 16.20% 2.75%

18,865.58$ 29,534.07$ 42,263.25$ 54,794.31$ 63,670.99$ 65,421.94$

5.43% 6.84% 8.26% 9.67% 11.09% 12.50%

1,023.93$ 2,020.72$ 3,489.47$ 5,299.16$ 7,058.25$ 8,177.74$

0.00% 7.00% 14.00% 21.00% 28.00% 35.00%1,023.93$ 1,879.27$ 3,000.94$ 4,186.33$ 5,081.94$ 5,315.53$

5,509.35$ 7,566.30$ 9,027.79$ 8,887.27$ 6,295.52$ 1,241.81$

(4,485.42)$ (5,687.03)$ (6,026.85)$ (4,700.94)$ (1,213.58)$ 4,073.72$

-$ -$ -$ -$ -$ -$

10.03% 9.63% 9.22% 8.81% 8.41% 8.00%

0.6200 0.5656 0.5178 0.4759 0.4390 0.4065

(2,781.02)$ (3,216.43)$ (3,120.90)$ (2,237.14)$ (532.75)$ 1,655.85$

1.41 1.41 1.41 1.41 1.41 1.41

14,136$ 21,702$ 30,730$ 39,617$ 45,913$ 47,154$

7.24% 8.66% 9.77% 10.57% 11.07% 11.27%

Compare this

a. the industr

b. the return


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If it is too high


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Terminal year

2.75%

67,221.04$

12.50%

8,402.63$ 8,424.49$

35.00%5,461.71$

1,877.46$ 47,333.66$

3,584.25$

-$

8.00%

After year 10

8.00%

Check these revenues against

a. Overall market size

b. Largest companies in this market

return on capital in year 10 against

y average(column E of worksheet)

n ca ital after ear 10

This is how much capital you

invested over the ten year

period.

This is is how much your operating income

grew over the ten-year period.


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(low), you may want to lower (raise) your sales to capital ratio


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Valuing Options or WarrantsEnter the current stock price = 168.76$Enter the strike price on the option = 21.20$

Enter the expiration of the option = 3.50

Enter the standard deviation in stock prices 50.00% (volatility)Enter the annualized dividend yield on sto 0.00%

Enter the treasury bond rate = 2.75%Enter the number of warrants (options) out 25.01

Enter the number of shares outstanding = 121.45

Do not input any numbers below this line

VALUING WARRANTS WHEN THERE IS DILUTION

Stock Price= 168.76 # Warrants issued= 25.008

Strike Price= 21.2 # Shares outstanding= 121Adjusted S = 164.831357 T.Bond rate= 2.75%

Adjusted K = 21.2 Variance= 0.2500

Expiration (in years) = 3.495 Annualized dividend yield= 0.00%

Div. Adj. interest rate= 2.75%

d1 = 2.76429031N (d1) = 0.99714766

d2 = 1.82954436

N (d2) = 0.96634095

Value per option = 145.75$

Value of all options outstanding = $3,644.97


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VALUATION DIAGNOSTICSInvested capital at start of valuationInvested capital at end of valuationChange in invested capital over 10 yearsChange in EBIT*(1t) (after-tax operating income) over 10 yearsMarginal ROIC over 10 years

ROIC at end of valuationAverage WACC over the 10 years (compounded)Your calculated value as a percent of current price

Inputs

Revenue growth rate (input cell B3)

Last period EBIT as % of revenue (Input cell B14)Sales to Capital Ratio or reinvestment (Input cell B15)Return on capital in perpetuity (B30 & B31)


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1,698.11$47,154.31$45,456.20$8,199.60$

18.04%

11.27%9.42%39.77%

If calculated value is negative or looks too low

Increase revenue growth rate

Increase the target pre-tax operating marginDecrease the sales/capital ratioIncrease relative to your cost of capital


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If calculated value looks too high

Decrease revenue growth rate

Decrease the target pre-tax operating margin

Increase the sales/capital ratioIf higher than your cost of capital, lower towards your cost of capital T

alue seems low. See below


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R & D ConverterThis spreadsheet converts R&D expenses from operating to capital expenses. It makes the appropriate adjustmentsincome, the book value of assets and the book value of equity.

Inputs

Over how many years do you want to amortize R&D expenses 5 ! If in doubt, use the lookup

Enter the current year's R&D expense = 310.06$ The maximum allowed is teEnter R& D expenses for past years: the number of years that you will need to enter will be determined by the amor

Do not input numbers in the first column (Year). It will get automatically updated based on the input above.

Year R& D Expenses

-1 273.98 ! Year -1 is the year prior to the current year

-2 208.98 ! Year -2 is the two years prior to the current year

-3 93.00

-4

-5

0

0

0

0

0

Output

Year R&D Expense Unamortized portion Amortization this year

Current 310.06 1.00 310.06

-1 273.98 0.80 219.18 54.80$

-2 208.98 0.60 125.39 41.80$

-3 93.00 0.40 37.20 18.60$

-4 0.00 0.20 0.00 -$

-5 0.00 0.00 0.00 -$

0 0.00 0.00 0.00 -$

0 0.00 0.00 0.00 -$

0 0.00 0.00 0.00 -$

0 0.00 0.00 0.00 -$

0 0.00 0.00 0.00 -$

Value of Research Asset = $691.83 115.19$

Amortization of asset for current year = $115.19

Adjustment to Operating Income = $194.87 ! A positive number indicates an increase in operating inc

Tax Effect of R&D Expensing $68


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o operating income, net

able below

yearstization period

ome (add to reported EBIT)


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Operating Lease Converter

The yellow cells are input cells. Please enter theInputs

Operating lease expense in current year = 380.00$

Operating Lease Commitments (From footnote to financials)

Year Commitment ! Year 1 is next year, .1 $56.00

2 $47.00

3 $39.004 $35.00

5 $31.00

6 and beyond $93.00

OutputPre-tax Cost of Debt = 7.00% ! If you do not have a cost of debt, use the synthetic rating estimator

Number of years embedded in yr 6 estimat 2 ! I use the average lease expense over the first five years

to estimate the number of years of expenses in yr 6Converting Operating Leases into debt

Year Commitment Present Value1 56.00$ 52.34$

2 47.00$ 41.05$

3 39.00$ 31.84$4 35.00$ 26.70$

5 31.00$ 22.10$6 and beyond 46.50$ 59.94$ ! Commitment beyond year 6 converted into an annuity for ten years

Debt Value of leases = 233.97$

Restated Financials

Depreciation on Operating Lease Asset = 33.42$ ! I use straight line depreciat

Adjustment to Operating Earnings = $346.58 ! Add this amount to pre-taxAdjustment to Total Debt outstanding = 233.97$ ! Add this amount to debt


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.

on

operating income


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Estimation of Current Cost of Capital Your inputsInputs Compute num erEquity

Number of Shares outstanding = 121.45

Current Market Price per share = 168.76$

Approach for estimating beta Multibusiness(US)

If direct input, enter levered beta (or regression be 1.20

Unlevered beta = 1.26

Riskfree Rate = 2.75%

What approach do you want to use to input ERP? ountry of incorporation

Direct input for ERP (if you choose "will input" 5.75%

Equity Risk Premium used in cost of equity = 5.80%

Debt

Book Value of Straight Debt = 578.74$

Interest Expense on Debt = 19.83$

Average Maturity = 2

Approach for estimating pre-tax cost of debt Direct input

If direct input, input the pre-tax cost of debt 7.000%

If actual rating, input the rating Baa2/BBB

If synethetic rating, input the type of company 1

Pre-tax Cost of Debt = 7.00%

Tax Rate = 35%

Book Value of Convertible Debt = 0

Interest Expense on Convertible = 0

Maturity of Convertible Bond = 0Market Value of Convertible = 0

Debt value of operating leases = -$

Preferred Stock

Number of Preferred Shares = 0

Current Market Price per Share= 70

Annual Dividend per Share = 5

Output

Estimating Market Value of Straight Debt = 541.34$

Estimated Value of Straight Debt in Convertible = -$

Value of Debt in Operating leases = -$

Estimated Value of Equity in Convertible = -$Levered Beta for equity = 1.28

Equity Debt referred Stoc Capital


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Market Value 20,495.90$ 541.34$ -$ 21,037.24$Weight in Cost of Capital 97.43% 2.57% 0.00% 100.00%

Cost of Component 10.18% 4.55% 7.14% 10.03%


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Operating Regions ERP calculator

Country Revenues ERP Weight Weighted ERP

Argentina 19 14.80% 9.31% 1.38%

Bolivia 4 10.68% 1.96% 0.21%

Brazil 130 8.43% 63.73% 5.37%

Canada 23 5.80% 11.27% 0.65%

Chile 7 6.85% 3.43% 0.24%

Ecuador 6 16.30% 2.94% 0.48%

Paraguay 3 11.80% 1.47% 0.17%

Peru 12 8.43% 5.88% 0.50%

0.00% 0.00% 0.00%

0.00% 0.00% 0.00%

Total 204 100.00% 9.00%

Operating Regions ERP calculator

Region Revenues ERP Weight Weighted ERP

Africa 0 10.09% 0.00% 0.0000%

Australia & New Zeala 56 5.80% 4.21% 0.2444%

Caribbean 12.57% 0.00% 0.0000%

Central and South Ame 100 9.18% 7.52% 0.6907%

Eastern Europe & Russia 8.48% 0.00% 0.0000%

Middle East 6.96% 0.00% 0.0000%

North America 631 5.80% 47.48% 2.7538%

Western Europe 374 6.85% 28.14% 1.9277%

Asia without Japan 168 7.58% 12.64% 0.9582%

Japan 0 6.85% 0.00% 0.0000%

Total 1329 100.00% 6.5748%

u t us ness n ustry verages

Business Revenues EV/Sales Estimated ValUnlevered Beta

Automotive 60.00$ 0.8100 48.60$ 1.1100

Computers/Peripherals 40.00$ 1.3800 55.20$ 1.3900

0.0000 -$ 0.0000

0.0000 -$ 0.0000

0.0000 -$ 0.0000

0.0000 -$ 0.0000

0.0000 -$ 0.0000

0.0000 -$ 0.0000

0.0000 -$ 0.0000

0.0000 -$ 0.0000

0.0000 -$ 0.0000

0.0000 -$ 0.0000Company 100.00$ 103.80$ 1.2589

Multi Business (Global Industry Averages)


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Business Revenues EV/Sales Estimated ValUnlevered BetaAdvertising 84.00$ 0.9383 78.82$ 0.9813

Internet software and se 16.00$ 4.3369 69.39$ 1.2164

0.0000 -$ 0.0000

0.0000 -$ 0.00000.0000 -$ 0.0000

0.0000 -$ 0.00000.0000 -$ 0.00000.0000 -$ 0.0000

0.0000 -$ 0.0000

0.0000 -$ 0.00000.0000 -$ 0.0000

0.0000 -$ 0.0000Company 100.00$ 148.21$ 1.0914


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Inputs for synthetic rating estimation

Please read the special cases worksheet (see below) before you use this spreaBefore you use this spreadsheet, make sure that the iteration box (under calculation optionsEnter the type of firm = 1

Enter current Earnings before interest and taxes (EBIT) = (216.72)$ (Add back only long term in

Enter current interest expenses = $19.83 (Use only long term interestEnter long term risk free rate = 2.75%

Output

Interest coverage ratio = -100000.00

Estimated Bond Rating = D2/D Note: If you get REF! All over the place

Estimated Company Default Spread = 12.00% to No, and then reset it to Yes. It shoul

Estimated County Default Spread (if any) 0.00%

Estimated Cost of Debt = 14.75%

If you want to update the spreads listed below, please visit http://www.bondsonline.com

For large manufacturing firms Ratings and Default spreads (reordered

If interest coverage ratio is If long term interest coverage ratio is

> to

Rating is Spread is greater than to Rating is-100000 0.199999 D2/D 12.00% 3 100000 Aaa/AAA0.2 0.649999 Caa/CCC 10.50% 2.5 2.99999 Aa2/AA

0.65 0.799999 Ca2/CC 9.50% 2 2.49999 A1/A+0.8 1.249999 C2/C 8.75% 1.5 1.99999 A2/A

1.25 1.499999 B3/B- 7.25% 1.2 1.49999 A3/A-

1.5 1.749999 B2/B 6.50% 0.9 1.199999 Baa2/BBB1.75 1.999999 B1/B+ 5.50% 0.75 0.899999 Ba1/BB+

2 2.2499999 Ba2/BB 4.00% 0.6 0.749999 Ba2/BB

2.25 2.49999 Ba1/BB+ 3.00% 0.5 0.599999 B1/B+2.5 2.999999 Baa2/BBB 2.00% 0.4 0.499999 B2/B3 4.249999 A3/A- 1.30% 0.3 0.399999 B3/B-

4.25 5.499999 A2/A 1.00% 0.2 0.299999 C2/C

5.5 6.499999 A1/A+ 0.85% 0.1 0.199999 Ca2/CC6.5 8.499999 Aa2/AA 0.70% 0.05 0.099999 Caa/CCC

8.50 100000 Aaa/AAA 0.40% -100000 0.049999 D2/D

For smaller and riskier firms

If interest coverage ratio is

greater than to Rating is Spread is-100000 0.499999 D2/D 12.00% Rating is Spread is

0.5 0.799999 Caa/CCC 10.50% A1/A+ 0.85%

0.8 1.249999 Ca2/CC 9.50% A2/A 1.00%1.25 1.499999 C2/C 8.75% A3/A- 1.30%

1.5 1.999999 B3/B- 7.25% Aa2/AA 0.70%

2 2.499999 B2/B 6.50% Aaa/AAA 0.40%

2.5 2.999999 B1/B+ 5.50% B1/B+ 5.50%3 3.499999 Ba2/BB 4.00% B2/B 6.50%

3.5 3.9999999 Ba1/BB+ 3.00% B3/B- 7.25%4 4.499999 Baa2/BBB 2.00% Ba1/BB+ 3.00%

4.5 5.999999 A3/A- 1.30% Ba2/BB 4.00%

6 7.499999 A2/A 1.00% Baa2/BBB 2.00%7.5 9.499999 A1/A+ 0.85% C2/C 8.75%

9.5 12.499999 Aa2/AA 0.70% Ca2/CC 9.50%

12.5 100000 Aaa/AAA 0.40% Caa/CCC 10.50%


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D2/D 12.00%


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sheet.n excel) is checked.

erest expense for financial firms)

expense for financial firms)

, set the operating lease commitment question in cell F5

work.

from highest to lowest)

Spread is0.40%

0.70%

0.85%1.00%

1.30%

2.00%3.00%

4.00%

5.50%6.50%

7.25%

8.75%

9.50%10.50%

12.00%


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Industry Name Number of firms nnual Average Revenue growth - Last 5 year re-tax Operating Margi

Advertising 32 8.67% 11.77%Aerospace/Defense 66 12.56% 10.24%Air Transport 36 13.21% 8.38%

Apparel 54 7.69% 10.37%Auto Parts 54 20.10% 6.72%Automotive 12 42.35% 5.80%

Bank 416 0.00% NABank (Midwest) 68 0.00% NABeverage 35 2.62% 20.74%Biotechnology 214 20.93% 18.54%Building Materials 43 1.28% 4.30%

Cable TV 20 9.08% 19.19%Chemical (Basic) 18 18.73% 14.84%Chemical (Diversified) 33 15.70% 15.02%Chemical (Specialty) 70 25.40% 11.16%

Coal 20 7.08% 14.19%Computer Software 191 14.81% 29.99%Computers/Peripheral 81 3.89% 16.94%

Diversified Co. 113 17.36% 14.91%

Drug 223 20.19% 25.24%E-Commerce 64 15.67% 8.24%Educational Services 33 10.29% 18.69%Electric Util. (Central) 20 4.05% 17.55%

Electric Utility (East) 17 1.50% 20.51%Electric Utility (West) 15 2.83% 16.44%Electrical Equipment 64 9.11% 13.77%Electronics 123 3.54% 6.39%

Engineering & Const 30 8.58% 4.83%Entertainment 76 10.73% 19.12%Entertainment Tech 42 6.07% 17.30%

Environmental 84 20.11% 14.65%Financial Svcs. (Div.) 256 5.86% 61.83%Food Processing 119 14.61% 9.73%

Foreign Electronics 10 -4.59% 3.41%Funeral Services 6 8.91% 14.37%Furn/Home Furnishing 32 2.78% 8.48%Healthcare Informatio 20 20.68% 16.53%Heavy Truck & Equip 23 27.10% 11.12%Homebuilding 22 11.34% 9.44%

Hotel/Gaming 57 14.27% 15.55%Household Products 27 13.01% 16.56%Human Resources 25 16.17% 3.05%Industrial Services 136 8.41% 7.90%

Information Services 28 8.56% 20.35%Insurance (Life) 32 0.00% NAInsurance (Prop/Cas.) 62 2.17% NA

Internet 194 11.68% 13.12%

Investment Companie 31 42.77% 26.90%IT Services 63 6.33% 11.19%Machinery 94 17.69% 11.95%

Maritime 51 0.35% 12.18%Med Supp Invasive 87 7.09% 21.19%Med Supp Non-Invasiv 143 8.96% 6.43%Medical Services 118 4.57% 10.05%

Metal Fabricating 25 19.43% 14.66%Metals & Mining (Div.) 77 21.71% 34.97%


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Natural Gas (Div.) 31 11.77% 28.13%Natural Gas Utility 27 0.45% 7.26%Newspaper 14 -6.65% 12.30%Office Equip/Supplies 22 12.17% 6.59%

Oil/Gas Distribution 12 8.28% 19.29%Oilfield Svcs/Equip. 81 26.77% 16.51%Packaging & Containe 27 10.50% 9.63%

Paper/Forest Products 32 6.15% 10.40%Petroleum (Integrated) 26 24.94% 11.99%Petroleum (Producing) 176 32.94% 21.76%Pharmacy Services 18 16.76% 5.48%Pipeline MLPs 53 20.21% 8.99%

Power 101 8.17% 6.97%Precious Metals 83 28.17% 39.11%Precision Instrument 82 10.50% 7.02%Property Management 31 14.32% 13.68%

Public/Private Equity 12 -8.37% 38.25%Publishing 29 6.27% 10.07%R.E.I.T. 127 0.01% 161.63%

Railroad 12 44.26% 28.08%

Recreation 51 5.39% 11.54%Reinsurance 11 0.00% NARestaurant 65 6.61% 16.78%Retail (Hardlines) 79 8.37% 8.22%

Retail (Softlines) 42 9.79% 9.37%Retail Automotive 19 22.30% 6.78%Retail Building Supply 10 5.08% 8.35%Retail Store 38 16.35% 5.24%

Retail/Wholesale Foo 30 8.91% 3.34%Securities Brokerage 27 1.86% 32.82%Semiconductor 142 6.94% 20.38%

Semiconductor Equip 10 -5.75% 11.80%Shoe 17 13.34% 8.37%Steel 33 26.86% 8.19%

Telecom. Equipment 105 1.06% 14.90%Telecom. Services 76 19.34% 20.13%Telecom. Utility 23 0.46% 14.69%Thrift 170 0.00% NATobacco 11 13.51% 22.35%Toiletries/Cosmetics 14 9.53% 11.07%

Trucking 34 15.05% 7.47%Water Utility 11 4.16% 26.21%Wireless Networking 58 6.59% 15.93%Total Market 6177 12.24% 17.13%


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After-tax ROC Average effective tax rate Unlevered Beta quity (Levered) Beta Cost of equity

11.49% 16.02% 1.44 1.68 11.51%19.40% 20.08% 0.92 0.98 7.45%17.97% 21.35% 0.82 1.03 7.73%

13.86% 18.57% 1.29 1.36 9.68%17.65% 18.77% 1.66 1.76 11.94%5.77% 16.24% 1.11 1.73 11.79%

NA 16.39% 0.45 0.77 6.24%NA 20.99% 0.76 0.89 6.95%

14.56% 18.82% 0.84 0.95 7.26%14.57% 2.98% 1.30 1.23 8.89%2.98% 9.48% 1.05 1.57 10.87%

10.52% 21.23% 0.96 1.40 9.90%17.75% 21.89% 1.24 1.37 9.73%18.12% 19.75% 1.47 1.55 10.75%12.48% 15.35% 1.05 1.18 8.59%

10.10% 11.27% 0.99 1.47 10.28%43.31% 12.43% 1.11 0.98 7.42%34.66% 10.01% 1.39 1.37 9.68%

9.21% 17.18% 0.86 1.22 8.82%

16.94% 5.14% 1.03 1.08 8.00%5.46% 10.52% 1.09 1.05 7.86%42.33% 21.72% 1.09 0.91 7.01%6.47% 30.12% 0.36 0.57 5.08%

6.69% 33.49% 0.30 0.43 4.24%6.17% 29.09% 0.38 0.58 5.14%

15.98% 16.15% 1.45 1.43 10.03%14.60% 11.31% 1.17 1.22 8.81%

13.16% 25.00% 1.40 1.28 9.19%10.41% 12.56% 1.31 1.60 11.05%19.51% 11.01% 1.33 1.11 8.20%

8.90% 7.60% 0.49 0.66 5.62%7.33% 16.23% 0.56 1.34 9.53%

13.56% 21.63% 0.77 0.87 6.83%

5.44% 23.12% 1.12 1.10 8.13%8.28% 28.66% 0.85 1.12 8.26%

14.06% 16.69% 1.47 1.63 11.20%11.68% 20.31% 0.98 0.97 7.36%15.21% 22.74% 1.45 1.80 12.22%7.68% 7.12% 1.25 1.55 10.73%

10.21% 17.52% 1.29 1.65 11.33%14.81% 24.66% 0.88 0.98 7.42%12.19% 26.61% 1.46 1.38 9.76%9.95% 20.19% 0.83 0.97 7.38%

12.71% 18.33% 1.05 1.25 9.00%NA 21.09% 1.41 1.44 10.11%NA 10.73% 0.90 0.85 6.69%

21.54% 8.43% 1.31 1.17 8.56%

5.87% 2.26% 1.21 1.27 9.11%21.77% 16.27% 1.11 1.05 7.83%13.43% 22.73% 1.18 1.26 9.07%

3.54% 7.92% 0.60 1.51 10.53%14.91% 12.60% 0.82 0.87 6.78%19.94% 10.61% 1.10 1.07 7.94%14.44% 17.72% 0.66 0.84 6.62%

14.39% 23.30% 1.56 1.63 11.19%25.19% 11.24% 1.54 1.62 11.14%


30/55

7.36% 22.02% 1.01 1.28 9.16%7.04% 28.80% 0.32 0.46 4.40%

10.99% 18.35% 1.50 1.86 12.56%10.89% 22.66% 1.05 1.43 10.03%

7.62% 18.11% 0.72 1.02 7.65%9.50% 18.20% 1.45 1.66 11.39%

11.11% 23.09% 0.88 1.20 8.72%

11.16% 11.43% 1.07 1.37 9.73%14.65% 30.34% 1.10 1.17 8.55%14.99% 11.71% 1.21 1.45 10.18%11.53% 23.18% 1.07 1.17 8.53%9.50% 4.30% 0.52 0.74 6.05%

2.62% 6.19% 0.58 1.35 9.61%11.91% 11.13% 1.00 1.03 7.75%5.78% 14.13% 1.21 1.27 9.12%4.72% 16.50% 0.73 1.30 9.30%

8.83% 19.17% 1.94 2.02 13.48%11.20% 22.69% 0.96 1.17 8.56%14.58% 0.04% 1.12 1.43 10.04%

12.37% 28.60% 1.15 1.32 9.40%

9.09% 20.31% 1.18 1.45 10.14%NA 3.58% 0.91 0.82 6.49%21.41% 19.23% 1.08 1.16 8.48%14.89% 22.55% 1.65 1.79 12.14%

30.03% 25.57% 1.51 1.43 10.05%9.57% 32.69% 1.10 1.39 9.82%

13.54% 25.56% 1.04 1.11 8.22%12.85% 24.83% 1.14 1.29 9.26%

11.26% 31.18% 0.58 0.68 5.69%7.09% 30.41% 0.66 1.07 7.95%

22.88% 11.71% 1.60 1.49 10.41%

11.35% 15.21% 2.01 1.79 12.16%17.66% 19.89% 1.37 1.26 9.09%7.59% 24.24% 1.27 1.65 11.32%

26.25% 14.01% 1.37 1.07 7.96%13.66% 16.22% 1.00 1.15 8.43%7.49% 26.94% 0.53 0.92 7.08%

NA 15.84% 0.78 0.68 5.68%31.97% 32.82% 0.79 0.86 6.75%21.44% 27.33% 1.09 1.17 8.52%

11.97% 25.94% 0.87 1.09 8.08%5.89% 31.45% 0.33 0.49 4.61%

12.27% 10.06% 1.17 1.35 9.62%12.88% 14.93% 0.96 1.17 8.53%


31/55

td deviation in stock pricesPre-tax cost of debt Market Debt/Capital Cost of capital Sales/Capital EV/SalesEV/EBITDA

97.40% 4.76% 29.00% 9.00% 1.40 1.22 7.7744.98% 2.76% 21.03% 6.23% 2.71 0.94 7.4264.94% 3.26% 37.14% 5.59% 2.74 0.78 6.00

74.88% 3.76% 12.11% 8.78% 1.89 1.52 11.7357.43% 3.26% 19.59% 9.98% 3.40 0.60 6.4059.23% 3.26% 50.84% 6.79% 1.41 0.81 7.46

50.34% 3.26% 56.18% 3.83% NA NA 4.8736.37% 2.76% 33.27% 5.19% NA NA 4.7947.17% 2.76% 18.22% 6.24% 0.93 3.23 12.7479.99% 3.76% 13.73% 7.98% 0.99 5.70 22.4679.76% 3.76% 39.48% 7.47% 0.88 1.54 14.45

40.45% 2.76% 39.80% 6.62% 0.80 2.37 7.0839.24% 2.76% 19.83% 8.13% 1.56 1.44 7.4449.02% 2.76% 14.30% 9.45% 1.63 1.67 8.5362.90% 3.26% 17.03% 7.46% 1.58 1.70 10.86

56.54% 3.26% 40.61% 6.90% 0.90 1.32 5.9968.39% 3.76% 6.15% 7.10% 1.87 3.33 9.7081.83% 4.26% 8.84% 9.05% 2.66 1.38 6.92

60.46% 3.26% 44.04% 5.80% 0.84 1.92 10.09

80.68% 4.26% 12.89% 7.30% 0.90 3.05 8.9380.60% 4.26% 6.31% 7.53% 1.17 5.07 32.1983.08% 4.26% 19.83% 6.13% 3.42 0.54 2.4117.29% 2.26% 45.95% 3.37% 0.54 2.27 7.98

13.21% 2.26% 40.44% 3.07% 0.49 2.78 8.9614.19% 2.26% 44.87% 3.44% 0.54 2.26 7.8767.79% 3.76% 10.94% 9.18% 1.58 1.49 8.5774.24% 3.76% 18.34% 7.61% 3.03 0.59 6.63

46.03% 2.76% 11.68% 8.31% 3.96 0.50 7.9870.99% 3.76% 25.30% 8.83% 0.79 2.34 9.5353.25% 3.26% 10.35% 7.56% 1.34 1.79 7.97

79.24% 3.76% 30.11% 4.60% 0.90 1.87 8.4455.15% 3.26% 67.15% 4.44% 0.15 8.15 12.5652.26% 3.26% 19.03% 5.90% 1.84 1.22 10.10

31.24% 2.76% 31.37% 6.10% 2.30 0.39 4.4426.75% 2.76% 33.10% 6.07% 0.85 1.84 9.7355.60% 3.26% 18.07% 9.53% 2.00 0.95 8.3444.41% 2.76% 10.41% 6.77% 1.07 3.60 14.3755.26% 3.26% 32.11% 8.92% 1.85 1.12 7.9666.75% 3.76% 33.14% 7.92% 0.88 2.19 21.15

55.66% 3.26% 30.91% 8.43% 0.82 2.43 10.6850.86% 3.26% 15.33% 6.58% 1.23 2.24 11.1251.64% 3.26% 9.75% 9.00% 6.81 0.34 8.6957.24% 3.26% 26.77% 5.92% 1.85 0.99 8.87

48.75% 2.76% 22.15% 7.37% 0.79 3.16 10.8942.20% 2.76% 35.84% 7.08% NA NA 1.3728.57% 2.76% 17.68% 5.80% NA NA 291.86

97.81% 4.76% 2.24% 8.43% 2.40 4.15 23.16

24.10% 2.26% 7.02% 8.57% 0.26 4.89 15.6756.11% 3.26% 5.41% 7.51% 2.98 1.79 12.2245.07% 2.76% 14.81% 7.97% 1.53 1.55 9.93

62.52% 3.26% 64.44% 5.00% 0.36 2.64 10.3655.49% 3.26% 14.15% 6.10% 0.92 2.71 10.1667.73% 3.76% 11.42% 7.29% 4.21 0.78 9.7874.16% 3.76% 33.44% 5.16% 2.19 0.74 6.02

60.59% 3.26% 19.09% 9.42% 1.38 1.28 6.9093.05% 4.76% 13.36% 10.03% 0.99 2.18 5.27


32/55

44.57% 2.76% 29.12% 6.97% 0.43 2.89 5.4128.44% 2.76% 39.82% 3.31% 1.40 1.03 9.8954.39% 3.26% 28.21% 9.57% 1.22 1.57 8.7251.92% 3.26% 41.91% 6.65% 2.34 0.46 4.76

35.63% 2.76% 34.81% 5.56% 0.56 3.42 12.0259.58% 3.26% 21.70% 9.34% 0.79 2.00 7.9836.52% 2.76% 35.97% 6.18% 1.56 1.08 7.57

52.28% 3.26% 30.07% 7.39% 1.32 1.18 7.2247.25% 2.76% 16.99% 7.38% 2.03 0.70 4.3971.26% 3.76% 21.95% 8.44% 1.07 1.26 4.0642.23% 2.76% 15.88% 7.44% 3.34 0.66 9.5724.88% 2.26% 30.73% 4.61% 1.10 1.70 13.43

84.63% 4.26% 62.04% 5.23% 0.61 1.51 8.9277.77% 3.76% 12.01% 7.09% 0.43 3.64 7.1760.11% 3.26% 17.50% 7.86% 1.23 1.89 14.8950.63% 3.26% 52.96% 5.41% 0.40 3.12 15.96

42.00% 2.76% 22.32% 10.84% 0.28 4.00 10.3065.72% 3.76% 26.55% 6.88% 1.66 1.32 8.7634.76% 2.76% 27.01% 7.78% 0.09 13.11 7.25

35.73% 2.76% 19.00% 7.93% 0.67 3.32 9.13

52.30% 3.26% 27.41% 7.90% 0.96 1.70 9.8920.74% 2.26% 15.90% 5.67% NA NA 28.6250.92% 3.26% 11.62% 7.72% 1.83 2.46 11.5063.49% 3.26% 20.64% 10.03% 2.61 0.87 7.65

42.54% 2.76% 5.29% 9.60% 5.17 1.14 9.0264.20% 3.26% 30.71% 7.40% 2.17 0.93 11.0331.82% 2.76% 10.49% 7.53% 2.55 1.31 12.2363.15% 3.26% 20.37% 7.77% 3.61 0.61 8.39

29.93% 2.76% 25.84% 4.65% 4.99 0.43 8.2740.56% 2.76% 72.57% 3.38% 0.30 3.23 8.7953.65% 3.26% 9.14% 9.64% 1.41 2.16 6.98

40.44% 2.76% 14.52% 10.63% 1.21 1.44 8.0747.32% 2.76% 1.90% 8.94% 3.24 1.42 14.0945.66% 2.76% 35.98% 7.84% 1.26 0.73 5.63

64.86% 3.26% 11.75% 7.25% 2.29 1.27 6.7464.04% 3.26% 24.14% 6.86% 0.90 1.91 5.3943.85% 2.76% 51.98% 4.26% 0.72 1.77 5.0841.73% 2.76% 16.32% 5.03% NA NA 4.0836.44% 2.76% 15.87% 5.94% 2.10 2.30 9.4840.10% 2.76% 17.10% 7.35% 2.83 1.37 10.10

48.32% 2.76% 29.74% 6.17% 2.44 0.82 6.1937.24% 2.76% 42.26% 3.36% 0.32 4.36 11.2062.91% 3.26% 20.43% 8.05% 0.94 2.68 10.4859.15% 3.26% 30.03% 6.56% 1.04 1.64 7.37


33/55

EV/EBIT Price/BookTrailing PE

10.40 2.04 31.259.15 3.11 15.799.32 3.68 14.60

14.68 3.38 21.648.92 2.27 15.39

13.95 1.26 15.84

4.87 0.98 16.584.79 1.32 16.43

15.58 4.54 19.9230.77 4.56 31.2435.82 1.67 29.27

12.35 4.09 22.289.69 2.77 31.77

11.11 3.18 19.7515.23 3.60 17.57

9.34 1.33 29.7611.11 3.94 77.298.14 3.57 46.69

12.87 2.38 16.19

12.10 3.04 28.4661.51 5.15 237.122.91 1.67 13.29

12.94 1.49 15.66

13.54 1.79 17.0813.74 1.44 16.0510.80 2.34 22.959.28 1.90 15.11

10.42 1.89 44.3412.22 2.38 27.8310.37 1.97 20.13

12.78 2.29 16.9913.19 1.98 22.1512.53 2.93 24.85

11.52 0.90 31.5212.80 2.09 17.8011.22 2.18 21.6421.77 3.89 54.5910.05 3.23 16.0823.16 2.54 49.55

15.66 3.07 35.3613.50 3.75 18.4911.06 2.21 30.5512.52 2.29 34.78

15.55 3.90 31.491.37 0.72 20.40

295.89 1.11 16.65

31.64 5.25 181.13

18.19 1.31 64.4516.02 4.36 39.4912.94 2.76 21.30

21.66 0.85 22.5712.81 2.82 46.6912.07 3.11 35.617.32 2.03 29.94

8.75 1.90 63.266.24 2.35 36.66


34/55

10.26 1.35 53.2114.20 1.99 23.0112.77 2.70 115.926.94 1.11 21.17

17.73 3.56 37.3012.13 1.79 14.6111.20 2.49 17.22

11.38 1.92 29.455.81 1.49 11.295.77 1.47 24.25

11.98 2.58 19.6718.87 2.96 130.50

21.70 0.82 304.869.30 1.61 24.60

26.86 2.57 23.5622.79 1.66 44.26

10.45 1.12 8.6513.14 3.37 14.228.11 1.29 16.85

11.81 2.99 17.50

14.69 2.01 24.7328.62 0.82 8.2514.65 6.65 19.5210.61 2.76 22.74

12.12 4.94 18.1913.74 3.46 15.9715.74 4.32 25.7611.67 2.90 20.34

12.98 3.18 14.899.85 0.93 20.01

10.58 2.72 50.55

12.22 1.64 25.2116.98 3.66 13.758.89 0.88 23.48

8.51 2.08 24.809.47 2.02 18.25

12.05 1.77 16.704.08 0.99 29.69

10.30 11.46 19.4212.39 6.04 20.39

10.96 3.07 16.7016.62 2.00 20.4616.83 3.51 29.689.59 2.11 33.45


35/55

Country Tax Rate

Afghanistan 20.00%

Albania 10.00%

Angola 35.00%

Argentina 35.00%

Armenia 20.00%Aruba 28.00%

Australia 30.00%

Austria 25.00%

Bahamas 0.00%

Bahrain 0.00%

Bangladesh 27.50%

Barbados 25.00%

Belarus 18.00%

Belgium 33.99%

Bermuda 0.00%

Bolivia 25.00%

Bonaire 0.00%

Bosnia and Herzegovin 10.00%

Botswana 22.00%

Brazil 34.00%

Bulgaria 10.00%

Cambodia 20.00%

Canada 26.00%

Cayman Islands 0.00%

Chile 18.50%

China 25.00%Colombia 33.00%

Costa Rica 30.00%

Croatia 20.00%

Curacao 27.50%

Cyprus 10.00%

Czech Republic 19.00%

Denmark 25.00%

Dominican Republic 29.00%

Ecuador 23.00%

Egypt 25.00%Estonia 21.00%

El Salvador 30.00%

Fiji 28.00%

Finland 24.50%

France 33.33%

Georgia 0.00%

Germany 29.48%


36/55

Gibraltar 10.00%

Greece 20.00%

Guatemala 31.00%

Guernsey 0.00%

Honduras 35.00%

Hong Kong 16.50%Hungary 19.00%

Iceland 20.00%

India 32.45%

Indonesia 25.00%

Ireland 12.50%

Isle of Man 0.00%

Israel 25.00%

Italy 31.40%

Jamaica 33.33%

Japan 38.01%

Jersey 0.00%

Jordan 14.00%

Kazakhstan 20.00%

Kenya 30.00%

Korea, Republic of 24.20%

Kuwait 15.00%

Latvia 15.00%

Libya 20.00%

Liechtenstein 12.50%

Lithuania 15.00%

Luxembourg 28.80%Macau 12.00%

Macedonia 10.00%

Malawi 30.00%

Malaysia 25.00%

Malta 35.00%

Mauritius 15.00%

Mexico 30.00%

Montenegro 9.00%

Mozambique 32.00%

Namibia 34.00%Netherlands 25.00%

New Zealand 28.00%

Nigeria 30.00%

Norway 28.00%

Oman 12.00%

Pakistan 35.00%

Panama 25.00%


37/55

Papua New Guinea 30.00%

Paraguay 10.00%

Peru 30.00%

Philippines 30.00%

Poland 19.00%

Portugal 25.00%Qatar 10.00%

Romania 16.00%

Russia 20.00%

Saba 0.00%

Samoa 27.00%

Saudi Arabia 20.00%

Serbia 10.00%

Singapore 17.00%

Slovak Republic 19.00%

Slovenia 18.00%

South Africa 34.55%

Spain 30.00%

Sri Lanka 28.00%

St Eustatius 0.00%

St Maarten 34.50%

Sudan 35.00%

Sweden 26.30%

Switzerland 21.17%

Syria 28.00%

Taiwan 17.00%

Tanzania 30.00%Thailand 23.00%

Trinidad and Tobago 25.00%

Tunisia 30.00%

Turkey 20.00%

Uganda 30.00%

Ukraine 21.00%

United Arab Emirates 55.00%

United Kingdom 24.00%

United States 40.00%

Uruguay 25.00%Vanuatu 0.00%

Venezuela 34.00%

Vietnam 25.00%

Yemen 20.00%

Zambia 35.00%

Zimbabwe 25.75%

Africa average 29.02%


38/55

North America average 33.00%

Asia average 22.89%

Europe average 20.50%

Latin America average 28.30%

Oceania average 28.60%

EU average 22.60%OECD average 25.25%

Global average 24.43%


39/55

Country ng-Term Rati Adj. Default Spread Total Risk Premium

Albania B1 4.00% 11.80%

Angola Ba3 3.25% 10.68%

Argentina B3 6.00% 14.80%

Armenia Ba2 2.75% 9.93%

Australia Aaa 0.00% 5.80%Austria Aaa 0.00% 5.80%

Azerbaijan Baa3 2.00% 8.80%

Bahamas Baa1 1.50% 8.05%

Bahrain Baa1 1.50% 8.05%

Bangladesh Ba3 3.25% 10.68%

Barbados Baa3 2.00% 8.80%

Belarus B3 6.00% 14.80%

Belgium Aa3 0.70% 6.85%

Belize Caa3 10.00% 20.80%

Bermuda Aa2 0.50% 6.55%Bolivia Ba3 3.25% 10.68%

Bosnia and Herzegov B3 6.00% 14.80%

Botswana A2 1.00% 7.30%

Brazil Baa2 1.75% 8.43%

Bulgaria Baa2 1.75% 8.43%

Cambodia B2 5.00% 13.30%

Canada Aaa 0.00% 5.80%

Cayman Islands Aa3 0.70% 6.85%

Chile Aa3 0.70% 6.85%

China Aa3 0.70% 6.85%

Colombia Baa3 2.00% 8.80%Costa Rica Baa3 2.00% 8.80%

Croatia Baa3 2.00% 8.80%

Cuba Caa1 7.00% 16.30%

Cyprus B3 6.00% 14.80%

Czech Republic A1 0.85% 7.08%

Denmark Aaa 0.00% 5.80%

Dominican Republic B1 4.00% 11.80%

Ecuador Caa1 7.00% 16.30%

Egypt B2 5.00% 13.30%

El Salvador Ba3 3.25% 10.68%Estonia A1 0.85% 7.08%

Fiji Islands B1 4.00% 11.80%

Finland Aaa 0.00% 5.80%

France Aa1 0.25% 6.18%

Georgia Ba3 3.25% 10.68%

Germany Aaa 0.00% 5.80%


40/55

Greece Caa1 7.00% 16.30%

Guatemala Ba1 2.40% 9.40%

Honduras B2 5.00% 13.30%

Hong Kong Aa1 0.25% 6.18%

Hungary Ba1 2.40% 9.40%

Iceland Baa3 2.00% 8.80%India Baa3 2.00% 8.80%

Indonesia Baa3 2.00% 8.80%

Ireland Ba1 2.40% 9.40%

Isle of Man Aaa 0.00% 5.80%

Israel A1 0.85% 7.08%

Italy Baa2 1.75% 8.43%

Jamaica B3 6.00% 14.80%

Japan Aa3 0.70% 6.85%

Jordan Ba2 2.75% 9.93%

Kazakhstan Baa2 1.75% 8.43%Kenya B1 4.00% 11.80%

Korea Aa3 0.70% 6.85%

Kuwait Aa2 0.50% 6.55%

Latvia Baa3 2.00% 8.80%

Lebanon B1 4.00% 11.80%

Lithuania Baa1 1.50% 8.05%

Luxembourg Aaa 0.00% 5.80%

Macao Aa3 0.70% 6.85%

Malaysia A3 1.15% 7.53%

Malta A3 1.15% 7.53%

Mauritius Baa1 1.50% 8.05%Mexico Baa1 1.50% 8.05%

Moldova B3 6.00% 14.80%

Mongolia B1 4.00% 11.80%

Montenegro Ba3 3.25% 10.68%

Morocco Ba1 2.40% 9.40%

Namibia Baa3 2.00% 8.80%

Netherlands Aaa 0.00% 5.80%

New Zealand Aaa 0.00% 5.80%

Nicaragua B3 6.00% 14.80%

Nigeria Ba3 3.25% 10.68%Norway Aaa 0.00% 5.80%

Oman A1 0.85% 7.08%

Pakistan Caa1 7.00% 16.30%

Panama Baa2 1.75% 8.43%

Papua New Guinea B1 4.00% 11.80%

Paraguay B1 4.00% 11.80%


41/55

Peru Baa2 1.75% 8.43%

Philippines Ba1 2.40% 9.40%

Poland A2 1.00% 7.30%

Portugal Ba3 3.25% 10.68%

Qatar Aa2 0.50% 6.55%

Romania Baa3 2.00% 8.80%Russia Baa1 1.50% 8.05%

Saudi Arabia Aa3 0.70% 6.85%

Senegal B1 4.00% 11.80%

Singapore Aaa 0.00% 5.80%

Slovakia A2 1.00% 7.30%

Slovenia Baa2 1.75% 8.43%

South Africa Baa1 1.50% 8.05%

Spain Baa3 2.00% 8.80%

Sri Lanka B1 4.00% 11.80%

St. Maarten Baa1 1.50% 8.05%St. Vincent & the Gr B2 5.00% 13.30%

Suriname Ba3 3.25% 10.68%

Sweden Aaa 0.00% 5.80%

Switzerland Aaa 0.00% 5.80%

Taiwan Aa3 0.70% 6.85%

Thailand Baa1 1.50% 8.05%

Trinidad and Tobago Baa1 1.50% 8.05%

Tunisia Baa3 2.00% 8.80%

Turkey Ba1 2.40% 9.40%

Ukraine B3 6.00% 14.80%

United Arab Emirate Aa2 0.50% 6.55%United Kingdom Aaa 0.00% 5.80%

United States of Ame Aaa 0.00% 5.80%

Uruguay Baa3 2.00% 8.80%

Venezuela B1 4.00% 11.80%

Vietnam B2 5.00% 13.30%

Zambia B1 4.00% 11.80%Row Labels Default Spread Total ERP (Weighted Average) Country Risk Premium (WeigAfrica 2.86% 10.09% 4.29%Australia & New Zealan 0.00% 5.80% 0.00%Caribbean 4.52% 12.57% 6.77%

Central and South Ame 2.26% 9.18% 3.38%Eastern Europe & Rus 1.79% 8.48% 2.68%Middle East 0.77% 6.96% 1.16%North America 0.00% 5.80% 0.00%Western Europe 0.70% 6.85% 1.05%Asia without Japan 1.18% 7.58% 1.78%Japan 0.70% 6.85% 1.05%


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ountry Risk Premiu Region

6.00% Eastern Europe & Russia

4.88% Africa

9.00% Central and South America


0.00% Australia & New Zealand0.00% Western Europe


2.25% Caribbean

2.25% Middle East

4.88% Asia

3.00% Caribbean


1.05% Western Europe


0.75%Caribbean



1.50% Africa



7.50% Asia

0.00% North America

1.05% Caribbean


1.05% Asia

3.00% Central and South America3.00% Central and South America


10.50% Caribbean




6.00% Caribbean


7.50% Africa

4.88% Central and South America1.28% Eastern Europe & Russia

6.00% Asia






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0.38% Asia


3.00% Western Europe3.00% Asia

3.00% Asia


0.00% Financial Center

1.28% Middle East


9.00% Caribbean

1.05% Asia

4.13% Middle East

2.63%Eastern Europe & Russia

6.00% Africa

1.05% Asia

0.75% Middle East


6.00% Middle East



1.05% Asia

1.73% Asia


2.25% Africa2.25% Central and South America


6.00% Asia


3.60% Africa

3.00% Africa


0.00% Australia & New Zealand


4.88% Africa0.00% Western Europe

1.28% Middle East

10.50% Asia


6.00% Asia



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3.60% Asia



0.75% Middle East

3.00% Eastern Europe & Russia2.25% Eastern Europe & Russia

1.05% Middle East

6.00% Africa

0.00% Asia



2.25% Africa


6.00% Asia

2.25%Caribbean

7.50% Caribbean

4.88% Caribbean



1.05% Asia

2.25% Asia

2.25% Caribbean

3.00% Africa



0.75% Middle East0.00% Western Europe

0.00% North America



7.50% Asia

6.00% Africahted Average)


45/55

Last 10K First X months: Last year irst X months: Current yea

Revenues $413.26 $41.30 $956.74

R&D expense $273.98 $107.17 $143.25

Operating income or EBIT -$394.28 -$194.94 -$17.38

Interest expenses $0.25 $20.23 $0.15

Book value of equity $124.70 $629.43

Book value of debt $452.34 $578.74Do you have operating lease commitments?Cash and cross holdings $201.89 $746.06

Non-operating assets $0.00 $0.00

Minority interests $0.00 $0.00

Number of shares outstanding = $121.45 $121.45

Current stock price =Effective tax rate = 0.00% 22.31% 0.00%

Marginal tax rate =Lease commitments

Year 1 $142.00 NA

Year 2 $128.00 NA

Year 3 $117.00 NA

Year 4 $110.00 NAYear 5 $102.00 NA

Beyond year 5 $252.00 NA


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Trailing 12 month

$1,328.70

$310.06

-$216.72

-$19.83


47/55

Yes/No Book or Market Valu ERP choices Cost of debt Synthetic rati BetaYes B Will input Direct input 1 Direct inputNo V Country of incorporationSynthetic rati 2 Single Business(US)

Operating countries Actual rating Single Business(Global)

Operating regions Multibusiness(US)Multibusiness(Global)


48/55

Industry Name Number of firms Unlevered beta corrected for cash Market D/E RAdvertising 255 0.98 32.29%Aerospace/Defense 210 0.89 26.27%Air Transport 160 0.60 100.92%

Apparel 1166 1.00 17.84%Auto & Truck 130 0.77 93.91%Auto Parts 624 1.19 37.00%

Bank 568 0.31 367.12%Banks (Regional) 944 0.44 142.34%Beverage 99 0.74 21.29%Beverage (Alcoholic) 209 0.68 24.36%Biotechnology 666 1.05 13.07%

Broadcasting 144 1.03 40.12%Brokerage & Investment Banking 525 0.28 415.35%Building Materials 420 0.81 44.77%Business & Consumer Services 709 0.83 25.13%

Cable TV 65 0.76 56.80%Chemical (Basic) 760 0.86 40.13%Chemical (Diversified) 86 1.11 42.99%

Chemical (Specialty) 693 0.99 20.55%

Coal & Related Energy 322 1.08 25.95%Computer Services 938 0.97 15.82%Computer Software 1068 1.12 7.33%Computers/Peripherals 371 1.04 16.06%

Construction 466 0.75 48.57%Diversified 365 0.67 79.08%Educational Services 145 1.10 20.26%Electrical Equipment 847 0.96 29.89%

Electronics 1188 1.01 31.80%Electronics (Consumer & Office) 208 0.96 57.73%Engineering 1141 0.81 83.04%

Entertainment 356 0.97 28.71%Environmental & Waste Services 307 0.86 40.91%Farming/Agriculture 331 0.74 42.90%

Financial Svcs. 520 0.18 656.46%Financial Svcs. (Non-bank & Insurance) 149 0.17 679.35%Food Processing 1223 0.69 27.68%Food Wholesalers 115 0.56 70.98%Furn/Home Furnishings 323 0.94 26.97%Healthcare Equipment 448 0.92 17.33%

Healthcare Facilities 170 0.54 80.65%Healthcare Products 155 0.78 19.42%Healthcare Services 328 0.81 31.97%Heathcare Information and Technology 266 0.96 20.13%

Heavy Construction 334 0.99 60.13%Homebuilding 155 1.00 58.09%Hotel/Gaming 618 0.84 30.37%

Household Products 456 0.82 14.25%

Information Services 171 0.98 12.13%Insurance (General) 220 0.71 57.51%Insurance (Life) 117 0.94 61.35%

Insurance (Prop/Cas.) 220 0.65 39.18%Internet software and services 715 1.22 4.72%Investment Co. 448 0.58 95.78%Machinery 1249 1.06 25.23%

Metals & Mining 1700 1.08 27.00%Office Equipment & Services 162 0.81 32.17%


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Oil/Gas (Integrated) 55 1.12 22.11%Oil/Gas (Production and Exploration) 1219 1.05 30.67%Oil/Gas Distribution 198 0.70 61.85%Oilfield Svcs/Equip. 570 1.12 36.67%

Packaging & Container 399 0.65 63.06%Paper/Forest Products 318 0.64 91.95%Pharma & Drugs 823 0.88 14.74%

Power 719 0.47 105.84%Precious Metals 1237 1.16 14.66%Publshing & Newspapers 401 0.75 39.77%R.E.I.T. 48 0.14 560.60%Railroad 56 0.46 65.38%

Real Estate 415 0.69 77.09%Real Estate (Development) 611 0.84 64.59%Real Estate (Operations & Services) 439 0.56 85.84%Recreation 292 0.86 31.84%

Reinsurance 35 0.86 42.79%Restaurant 298 0.62 23.26%Retail (Automotive) 138 0.74 51.60%

Retail (Building Supply) 51 0.68 18.80%

Retail (Distributors) 842 0.61 97.73%Retail (General) 226 0.78 32.07%Retail (Grocery and Food) 170 0.54 38.11%Retail (Internet) 108 1.08 5.00%

Retail (Special Lines) 536 1.01 13.85%Rubber& Tires 91 0.84 51.66%Semiconductor 564 1.20 13.88%Semiconductor Equip 264 1.49 22.44%

Shipbuilding & Marine 351 0.68 90.71%Shoe 95 1.06 7.42%Steel 725 0.86 81.02%

Telecom (Wireless) 117 0.79 31.99%Telecom. Equipment 550 1.18 15.23%Telecom. Services 325 0.63 65.54%

Thrift 295 0.02 5432.46%Tobacco 48 0.49 15.48%Tranportation 223 0.75 48.75%Trucking 185 0.55 77.55%Utility (General) 61 0.41 107.15%Utility (Water) 97 0.53 63.18%

Grand Total 40943 0.64 98.96%


50/55

Market Debt t Effective tax Dividend Pay Net Margin Pre-tax OperROE ROIC Sales/Capital24.41% 13.92% 34.69% 3.86% 8.10% 9.42% 42.52% 4.5320.80% 13.31% 33.18% 5.35% 8.91% 16.43% 35.50% 4.8650.23% 16.15% 51.21% 1.66% 4.84% 6.35% 6.94% 1.67

15.14% 13.42% 37.80% 6.48% 11.70% 12.92% 15.05% 1.5548.43% 12.66% 16.30% 5.81% 5.98% 18.61% 7.83% 1.4927.00% 16.55% 12.54% 4.20% 6.60% 13.90% 14.33% 2.50

78.59% 18.93% 32.02% 20.42% 0.25% 8.97% 0.02% 0.0958.74% 18.85% 15.95% 18.68% 0.00% 7.17% 0.00% 0.2317.55% 12.82% 30.71% 10.12% 14.77% 21.29% 18.97% 1.6019.59% 18.60% 33.05% 11.69% 18.89% 17.27% 14.32% 0.8911.56% 2.91% 34.78% 8.08% 17.16% 7.25% 11.45% 0.80

28.63% 17.52% 31.74% 8.49% 15.89% 13.12% 15.03% 1.1280.60% 11.36% 36.87% 5.02% 0.18% 4.13% 0.02% 0.1730.93% 16.08% 36.75% 2.46% 6.14% 5.13% 7.58% 1.7120.08% 18.11% 40.69% 4.20% 7.85% 12.28% 19.57% 3.23

36.22% 14.42% 15.91% 9.79% 18.41% 26.04% 15.33% 1.0828.64% 13.56% 57.82% 3.79% 6.69% 8.03% 7.99% 1.3230.07% 20.09% 43.49% 3.43% 7.96% 9.84% 10.52% 1.78

17.05% 16.99% 30.49% 8.00% 12.65% 14.69% 15.64% 1.48

20.60% 6.36% 55.14% 8.20% 15.68% 10.92% 15.36% 0.9413.66% 17.31% 21.36% 5.44% 8.16% 20.43% 28.10% 4.566.83% 11.68% 27.50% 14.49% 22.50% 16.62% 40.08% 1.97

13.83% 12.32% 16.88% 5.02% 9.96% 17.06% 32.20% 3.28

32.69% 14.87% 50.95% 5.17% 10.85% 7.25% 7.89% 0.8544.16% 13.26% 25.92% 6.18% 9.25% 11.53% 7.62% 0.8816.84% 14.29% NA -1.40% 11.08% -2.57% 21.01% 2.6423.01% 13.88% 50.70% 3.30% 6.86% 7.24% 11.05% 2.10

24.12% 12.33% 30.54% 2.78% 4.48% 6.20% 6.47% 1.8536.60% 12.17% NA -5.21% 2.32% -13.51% 3.57% 2.4545.37% 17.02% 59.23% 1.79% 4.52% 6.83% 7.93% 2.28

22.31% 8.79% 28.43% 7.88% 16.46% 10.39% 21.13% 1.6929.03% 11.25% 62.60% 2.97% 8.92% 6.76% 13.28% 2.0430.02% 13.56% 28.83% 3.84% 4.84% 10.86% 7.78% 1.82

86.78% 17.11% 16.51% 21.78% 6.43% 14.39% 0.38% 0.0987.17% 13.67% 8.01% 13.70% 3.31% 6.42% 0.22% 0.0921.68% 15.80% 43.33% 4.79% 8.05% 12.30% 13.63% 2.1341.51% 18.45% 54.16% 1.06% 2.99% 10.56% 13.98% 5.5121.24% 14.93% 30.24% 4.15% 6.11% 12.02% 13.60% 2.6314.77% 8.87% 37.02% 9.98% 18.21% 13.27% 24.36% 1.50

44.65% 16.54% 15.05% 4.24% 10.37% 26.49% 14.16% 1.6416.26% 13.49% 22.73% 7.95% 12.14% 12.03% 14.31% 1.3224.23% 17.34% 16.77% 2.48% 4.77% 13.81% 30.87% 7.1916.76% 8.16% 14.89% 6.27% 12.10% 7.84% 16.39% 1.54

37.55% 17.82% 31.37% 4.74% 8.32% 15.66% 11.92% 1.5736.75% 19.22% 14.51% 4.16% 6.61% 7.73% 5.94% 1.2423.29% 12.19% 36.52% 5.73% 11.80% 8.02% 10.35% 0.95

12.47% 13.98% 43.82% 8.68% 14.34% 16.86% 22.08% 2.14

10.81% 16.19% 31.17% 10.40% 22.04% 15.35% 42.97% 2.3636.51% 13.65% 21.45% 5.89% 7.96% 11.52% 10.66% 1.5638.02% 17.28% 34.76% 3.67% 6.60% 7.68% 8.95% 1.50

28.15% 11.96% 31.87% 4.42% 7.64% 7.35% 7.58% 1.234.51% 7.77% 4.29% 18.74% 21.16% 19.32% 24.00% 1.25

48.92% 5.97% 38.86% 14.53% 11.33% 8.11% 3.21% 0.2920.15% 17.48% 32.02% 5.32% 8.92% 10.87% 12.83% 1.83

21.26% 4.26% 45.90% 7.44% 15.44% 10.76% 12.83% 1.0024.34% 17.48% 41.76% 4.25% 7.35% 12.40% 15.21% 2.60


51/55

18.11% 25.53% 27.55% 7.68% 10.78% 16.80% 12.65% 1.6923.47% 6.41% 44.13% 7.34% 17.88% 7.14% 8.66% 0.6838.21% 8.92% 115.27% 5.03% 10.38% 11.00% 8.71% 0.7326.83% 14.22% 26.59% 2.36% 4.24% 11.21% 11.01% 3.28

38.67% 17.17% 43.18% 2.80% 7.51% 7.73% 11.05% 1.7447.90% 11.75% 80.79% 1.95% 5.18% 3.47% 3.98% 1.0212.85% 12.53% 44.83% 12.55% 21.12% 13.76% 18.46% 1.13

51.42% 15.12% 93.77% 3.62% 10.49% 5.23% 5.14% 0.6412.78% 3.52% 61.89% 6.98% 18.63% 4.97% 8.79% 0.5828.46% 15.27% 1731.52% 0.16% 7.95% 0.26% 10.44% 1.7984.86% 2.99% 55.74% 61.89% 2.67% 10.89% 0.07% 0.0239.53% 21.56% 24.67% 9.07% 18.00% 11.68% 7.27% 0.60

43.53% 12.96% 22.44% 13.08% 15.39% 8.51% 4.32% 0.3139.24% 17.32% 32.51% 19.74% 24.18% 12.96% 7.28% 0.3646.19% 13.51% 22.36% 22.99% 29.36% 8.76% 4.58% 0.1824.15% 15.30% 28.25% 5.97% 11.01% 9.65% 10.47% 1.31

29.97% 11.47% 24.17% 8.86% 12.30% 14.39% 15.67% 1.2518.87% 20.90% 40.98% 6.14% 11.37% 19.63% 18.98% 2.2034.04% 19.42% 16.71% 2.82% 5.12% 17.68% 12.96% 3.11

15.82% 23.15% 38.17% 3.91% 7.43% 13.28% 12.75% 2.72

49.42% 19.16% 30.47% 2.60% 3.52% 11.51% 5.90% 2.0624.28% 22.21% 35.74% 2.82% 5.10% 13.35% 12.28% 3.2827.59% 23.43% 39.98% 2.15% 4.14% 12.11% 12.94% 3.96

4.76% 11.10% 21.17% 2.83% 5.02% 14.07% 44.11% 7.82

12.16% 20.10% 31.63% 3.53% 6.62% 13.63% 18.53% 3.9434.06% 16.86% 16.29% 4.71% 8.10% 15.87% 11.74% 1.7712.19% 8.19% 38.44% 7.21% 11.30% 10.20% 12.92% 1.3018.33% 7.82% NA -1.37% 7.82% -1.66% 7.97% 1.21

47.56% 11.28% 497.14% 0.35% 5.05% 0.54% 2.97% 0.826.90% 16.82% 18.13% 7.16% 9.81% 16.29% 18.16% 2.12

44.76% 12.68% 411.43% 0.33% 3.86% 0.72% 3.97% 1.36

24.24% 14.76% 111.38% 4.90% 16.86% 6.29% 12.46% 0.9613.22% 9.09% 46.05% 5.90% 7.46% 9.43% 11.82% 1.9339.59% 11.92% 103.40% 5.58% 14.71% 9.01% 12.33% 0.98

98.19% 18.11% 9.16% 39.07% 0.59% -12.11% 0.00% 0.0113.40% 19.70% 63.68% 16.71% 28.10% 44.22% 47.52% 2.4432.77% 19.61% 42.98% 5.01% 8.46% 13.01% 10.37% 1.6043.68% 21.99% 21.81% 2.95% 6.16% 10.18% 7.81% 1.7251.73% 23.56% 91.00% 3.71% 10.48% 7.06% 8.12% 1.0038.72% 14.78% 54.81% 16.28% 27.53% 12.47% 8.81% 0.36

49.74% 13.40% 37.49% 5.74% 8.63% 10.49% 5.11% 0.77


52/55

EV/Sales Revenue Gro Expected Earnings growth: Next 5 years0.94 6.82% 21.10%0.99 5.45% 12.24%0.79 9.50% 21.78%

1.55 8.05% 14.17%0.78 7.89% 16.78%0.56 7.61% 15.87%

11.36 9.33% 15.27%3.92 4.05% 7.68%2.23 9.19% 14.06%2.91 9.46% 17.42%6.52 18.82% 21.89%

2.06 6.87% 5.90%6.08 5.54% 16.91%0.89 1.84% 19.07%1.09 7.64% 15.23%

2.38 11.67% 5.51%1.06 6.76% 16.00%0.96 7.14% 15.67%

1.52 10.95% 15.12%

1.81 15.30% 14.80%0.90 9.20% 14.72%3.22 10.54% 19.64%0.90 0.21% 48.32%

1.70 10.75% 18.76%1.46 7.65% 13.98%0.97 15.14% 20.40%1.01 8.43% 20.52%

0.74 2.24% 18.27%0.49 -1.34% 16.82%0.56 8.60% 15.76%

1.94 3.98% 20.99%1.31 12.01% 14.79%0.71 17.26% 22.13%

11.59 10.60% 16.59%11.24 13.81% 21.86%

1.20 10.36% 20.44%0.30 3.43% 11.57%0.72 3.67% 25.07%2.55 8.27% 15.75%

1.28 17.71% 15.74%2.49 14.20% 18.06%0.46 13.17% 16.52%2.33 12.10% 21.93%

0.99 9.79% 10.97%0.99 1.36% 10.35%2.24 10.03% 14.85%

2.09 11.76% 16.06%

3.05 6.26% 14.57%0.67 5.98% 15.55%0.77 5.07% 12.51%

0.91 8.42% 19.51%4.34 9.16% 23.77%3.62 8.47% 10.66%1.13 3.89% 15.82%

1.58 20.44% 10.67%0.72 2.53% 14.58%


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0.74 14.00% 8.80%2.21 21.47% 18.55%2.23 16.37% 17.40%0.52 15.38% 26.79%

0.89 9.61% 16.01%1.06 6.17% 13.86%2.78 13.72% 18.46%

1.80 13.97% 11.64%3.02 40.88% 18.47%1.18 1.45% -4.05%

47.03 2.02% 4.94%2.27 3.83% 17.27%

3.24 5.65% 18.54%3.10 12.44% 19.95%6.03 10.18% 15.90%1.31 1.93% 16.35%

0.73 6.02% 15.30%1.55 6.48% 15.53%0.63 6.02% 15.76%

0.95 5.10% 13.61%

0.57 6.29% 16.59%0.65 7.69% 15.61%0.48 5.93% 13.19%2.11 12.55% 31.94%

0.79 5.00% 12.17%0.78 10.45% 35.67%1.66 5.70% 17.73%1.52 0.87% 12.94%

1.24 8.50% 1.87%1.27 8.98% 14.72%0.75 8.35% 17.15%

1.87 8.43% 11.64%1.37 3.55% 18.69%1.56 7.88% 8.79%

112.28 7.27% 8.29%3.33 6.18% 9.46%1.14 11.17% 14.34%0.79 3.04% 13.65%1.24 8.49% 5.63%4.03 17.20% 12.97%

1.76 8.94% 16.07%


54/55

$(1,000)

$-

$1,000

$2,000

$3,000

$4,000

$5,000

$6,000

$7,000

$8,000

$9,000

$-

$10,000

$20,000

$30,000

$40,000

$50,000

$60,000

$70,000

Base 1 2 3 4 5 6 7 8 9 10

Pre-taxOperatingIncome

Revenues(inbillions)

Revenues

Pre-tax operating inco


55/55

Year Revenues Pre-tax operating incomeBase 1,329$ (22)$

1 2,259$ (5)$2 3,840$ 45$

3 6,528$ 170$4 11,097$ 445$5 18,866$ 1,024$

6 29,534$ 2,021$7 42,263$ 3,489$8 54,794$ 5,299$9 63,671$ 7,058$

10 65,422$ 8,178$

valuation of tesla

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