- 45 -
Furthermore, in considering the trading history of the
shares, Tarbell did not consider petitioner's arm's-length sale
of approximately 1.69 percent23 of Willits' issued and
outstanding shares at a price near book value to unrelated
parties less than 10 months after decedent's death. Therefore,
Tarbell did not consider all the evidence relevant to deciding
the size of the discount. Accordingly, we give little weight to
this portion of petitioner's opinion.
Respondent's Expert's Opinion
Respondent's expert is Spiro. In his report, Spiro used the
market and income methods and considered the actual sales to
value petitioner's Willits shares. Spiro ultimately concluded
that the fair market value of the stock was $774 per share.
Spiro found five publicly traded bank companies that were
sufficiently comparable to Willits to use as guideline companies
for the market method of valuation. Employing the same
methodology that he used to value the Savings shares, Spiro
selected certain financial ratios to value the Willits shares.
Weighting the price-to-earnings ratio 50 percent, the price-to-
book ratio 40 percent, and the dividend yield measure 10 percent,
Spiro derived an indicated value of $944 per share for a minority
interest in Willits, if the shares were liquid and freely traded.
23This amount does not include the 365 shares sold to
Mannon.
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