So someone pulled the trigger on a purchase of a social media firm. Microsoft announced a deal to acquire Linked IN this morning for $26.2 billion.
Here are some initial data on the purchase:
Purchase Price $26.2 Billion
Per Share (based on 2015 End of Year diluted shares out): $203.06
What did Microsoft buy in terms of fundamentals?
Linked in ROE = -3.72%
Adjusted ROE = -11.7%
Return on Net Operating Assets = 24.8%
Return From Leverage = -15.2%
Return from Other = -21.3%
A hefty price to pay no doubt, but at least the operations are profitable.
** All metrics were run using Calcbench tools. The percentages were developed using the calcbench excel add-in, along with a valuation model that we have developed.
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