Lona sells ABG 79.55: Over the 20-year period, my projected EBITDA grows from $294m on a 6.5% annual basis over the explicit projection period.

While on paper it would seem that my EBITDA projections are too hopeful due to the difference in slopes, it is in fact the complete opposite. The graph below displays the growth trajectory of projected EBITDAs. The resulting cash flows were then probability weighted and ultimately we end up with a projected EBITDA for each of the four categories. As I discussed above, each EBITDA component had a base growth combined with an interval of growth and a floor. I display this growth along with the trajectory of growth in order to justify my assumptions.


Barbra:
It is a growth chart of EBITDA and its respective components over the 2010-2014 period.

Nicki:
The same was done for all of the other categories, albeit with their respective numbers as displayed on the table above.

Lise:
I did the same thing for the base and bear cases, and assigned probabilities to each of the line items to add up to 100%. Thus, I probability weighted each year's EBITDA and came out with a total by adding the three lines.

Linda:
The bull case would have a floor of 8%, thus when the percentage side of the equation reached 8%, it would remain there.

Adelina:
For each line, I used the respective growth assumption.

Veda:
I used 2014 EBITDA as a year 0 metric.

Micheal:
The first line was the bull scenario, the second the base, and the third the bear.

Jaimee:
Below is a table further detailing how I went about projecting EBITDA.

Gerry:
I used the CAGR as a starting point and decided to project over a 20-year period.

Mary:
Once I finished analyzing the previous data set, I decided to project the future EBITDA, a proxy of free cash flow, in order to decide whether a premium to the price of Asbury's stock deserved merit.

Asbury Automotive Group Inc (NYSE:ABG)
//stockhand.net/us/?q=nyse%3Aabg&id=446329