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Petitioner's Expert's Opinion
Petitioner's expert is Jeffrey T. Tarbell (Tarbell).
Tarbell is a senior associate of Willamette Management
Associates, and was a qualified expert at the time he prepared
his report. Tarbell's testimony at trial was cryptic and
unhelpful; we, therefore, rely upon only the written report for
his opinion. Tarbell did not consider petitioner's sale of its
stock in his analysis.
Tarbell selected nine publicly traded banks comparable to
Willits as guideline companies and used the market method to
value the Willits shares. Tarbell compared Willits' earnings per
share for the last 12 months to the guideline companies' earnings
per share for the same period, and selected four companies that
had earnings growth rates similar to Willits. Using the
companies' ratios for guidance, Tarbell selected a multiple to
apply to Willits' earnings per share, and derived an indicated
value of $902 per share. He repeated the same process with
Willits' 5-year average earnings per share, and derived an
indicated value of $945 per share.
Tarbell compared the guideline companies' dividend payout
ratios to their dividend yields. He found that there was a
relationship between the payout ratios and the dividend yields,
and that the companies with higher payout ratios have higher
dividend yields. Tarbell selected one company from the guideline
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