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Ultimately, we accept Mr. Burns’s explanation that there is
a premium in the industry, on the basis of his analysis of
publicly held companies. We note that there is no meaningful
universe of information available for closely held companies or
Godfrey’s particular boat manufacturing niche. Although the 5.2-
percent premium was based on some data from years subsequent to
1997, we are satisfied that the 5.2 percent is within a
reasonable range. In part, we base our conclusion on Godfrey’s
tendency to generally outperform the industry and economy, so
that the 5.2-percent premium may be on the conservative side.
Moreover, we are more comfortable with Mr. Burns’s methodology,
for which he has provided explanations supporting his conclusions
and assumptions. On the question of industry risk, Mr. Dorman’s
figures are without empirical support or explanation and appear
to be purely subjective.
Mr. Burns used a 10.01-percent discount rate, which
translates into an approximately 9.9900099-percent capitalization
rate. That capitalization rate produced an income approach value
of $30,740,869 when multiplied by Mr. Burns’s $3,077,161
normalized earnings for 1997. Likewise, Mr. Dorman, by using a
17.50-percent discount rate, which translates into a 5.7142857-
percent capitalization rate, produced an income approach value of
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