Roger,
Knew I must have missed something. You are right, I should have adjusted for taxes. I would assume Tiger, based in the US, was already fully taxed, so I'll leave their numbers alone. HAS paid taxes at a rate of 35% last year. RADAF paid 0%, it appears. So we should knock 35% off RADAF earnings in an acquisition. For last years earnings, I get $0.88 fully taxed, 14.25x results in a $12.40 buyout price now based on last years earnings. Looking forward, $3.00 untaxed is $1.95 fully taxed, 14.25x is $27.80/share buyout price in a year.
[I am now putting on my flameproof asbestos suit in preparation for the following editorial remark]
So maybe the upside to RADAF is excellent (75% in a year), but not nearly as high as some of the numbers being thrown around on this thread. The low tax status of Radica makes a huge difference in a buyout in a year by a US toy company (from $42.75/share to $27.80/share).
Dennis |
