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In applying this method, Gasiorowski first selected eight
publicly traded banks with overall characteristics similar to
Savings as "guideline companies". He then compared the guideline
companies' operating results and financial positions from 1986
through the third quarter of 1991 with Savings' operating results
and financial positions for the same time period. On the basis
of this comparative analysis, Gasiorowski selected certain
financial ratios to value the Savings shares. Giving equal
weight to the price-to-earnings ratios, the price-to-book ratios,
and the price-to-dividend ratios, Gasiorowski concluded that the
"marketable minority value" of the Savings stock was $295 per
share, before considering a discount for lack of marketability.
The marketable minority value is Gasiorowski's "best estimate of
what the Savings Bank stock might sell for if it were publicly
traded."
The income method values an asset based upon the present
value of its future economic benefits. To estimate the value of
the Savings shares with this method, Gasiorowski interviewed
Savings' management concerning the bank's future, and obtained
its 1992 budget. Gasiorowski developed the discount rate used to
calculate the present value of Savings' 1992 estimated net income
by reducing the rate of return that he thought an equity investor
in Savings would require by 4 percent, his estimate of Savings'
long-term growth rate. Using this method, Gasiorowski concluded
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