If a company has $5M of EBITDA and two similar public companies trade at multiples of 6.0x and 7.0x EBITDA, what could be concluded about the company's enterprise value?

To analyze the company's enterprise value based on its EBITDA of $5 million, we can apply the multiples observed in the market from the comparable public companies. The first company trades at a multiple of 6.0x EBITDA, and the second one at 7.0x EBITDA.

To calculate the potential enterprise value of the company, we can apply both multiples to its EBITDA. When we multiply:

• Using the lower multiple of 6.0x:

( 6.0 \times 5M = 30M )

• Using the higher multiple of 7.0x:

( 7.0 \times 5M = 35M )

This tells us that, based on the market values of similar companies, the company's enterprise value could reasonably be expected to fall between $30 million and $35 million. This range reflects the current market standards and helps to benchmark the company against its peers.

The conclusion that the company's enterprise value should be between $30 million and $35 million aligns with the use of multiples to estimate valuations. Therefore, the most appropriate conclusion drawn from the given information is that the company's enterprise value lies within this interval. The other options either overshoot or do not