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by publicly traded companies and privately held entities. It
also considers the total investment, which, as discussed infra,
is especially important for the Sta-Home tax-exempt entities.
We do not agree, however, that Wilhoite ascertained an
accurate price-to-revenue multiple for ascertaining the Sta-Home
tax-exempt entities’ MVIC. His .3 multiplier was approximately
half that applicable to the median of the publicly traded
comparables. His discount reflects petitioners’ demonstration
that many of these publicly traded companies functioned in areas
where combinations of businesses, including managed care
operations, produced more favorable prospects than were generally
available in Mississippi. Wilhoite’s discount does not, however,
sufficiently take into account the absence from the Sta-Home
services of some of the more sophisticated, and remunerative,
home health care techniques, such as infusion and respiratory
therapies. These techniques were utilized by many of the
comparison companies. We therefore believe that the price-to-
revenue multiple for publicly traded companies should be no
higher than the .25 that he applied to the merged and acquired
comparable companies.
We also fail to find Wilhoite’s valuation particularly
meaningful solely on the basis of the capitalization of Sta-Home
tax-exempt entities’ intangible known as the “cost gap”.
Wilhoite has correctly noted that the cost gap has substantial
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