Post Merger PE Calculator

✖Weighted Average Eps of Acquirer reflects the combined earnings per share of the acquirer and the target, adjusted for their respective sizes in the post-merger entity.ⓘ Weighted Average Eps of Acquirer [WAEA]			+10% -10%
✖Weighted Average Eps of Target provides a weighted average Eps that reflects the combined earnings per share of the target and the acquirer.ⓘ Weighted Average Eps of Target [WAET]			+10% -10%

✖Post Merger Pe refers to the price to earnings ratio of a company after it has undergone a merger or acquisition.ⓘ Post Merger PE [PMP]

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Formula

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Post Merger PE

Formula

`"PMP" = "WAEA"+"WAET"`

Example

`"4.2"="1.30"+"2.90"`

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Post Merger PE Solution

STEP 0: Pre-Calculation Summary

Formula Used

Post Merger Pe = Weighted Average Eps of Acquirer+Weighted Average Eps of Target
PMP = WAEA+WAET
This formula uses 3 Variables

Variables Used

Post Merger Pe - Post Merger Pe refers to the price to earnings ratio of a company after it has undergone a merger or acquisition.
Weighted Average Eps of Acquirer - Weighted Average Eps of Acquirer reflects the combined earnings per share of the acquirer and the target, adjusted for their respective sizes in the post-merger entity.
Weighted Average Eps of Target - Weighted Average Eps of Target provides a weighted average Eps that reflects the combined earnings per share of the target and the acquirer.

STEP 1: Convert Input(s) to Base Unit

Weighted Average Eps of Acquirer: 1.3 --> No Conversion Required
Weighted Average Eps of Target: 2.9 --> No Conversion Required

STEP 2: Evaluate Formula

Substituting Input Values in Formula

PMP = WAEA+WAET --> 1.3+2.9

Evaluating ... ...

PMP = 4.2

STEP 3: Convert Result to Output's Unit

4.2 --> No Conversion Required

FINAL ANSWER

4.2 <-- Post Merger Pe

(Calculation completed in 00.004 seconds)

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Credits

Created by Aashna

IGNOU (IGNOU), India

Aashna has created this Calculator and 50+ more calculators!

Verified by Vishnu K

BMS College of Engineering (BMSCE), Bangalore

Vishnu K has verified this Calculator and 200+ more calculators!

< 10+ Mergers and Acquisitions Calculators

Post Merger Value of Merged Company

Go Post Merger Value of Merged Company = Pre Merger Value of the Acquirer+Pre Merger Value of Target Company+Synergies Generated-Cash Paid to Shareholders

Goodwill

Go Goodwill = Consideration Paid+Fair Value of Non Controlling Interest+Fair Value of Equity Previous Interest-Fair Value of Net Assets Recognized

Accretion Amount

Go Accretion Amount = ((Purchase Basis)*(Yield to Maturity/Accrual Period Per Year))-Coupon Interest

Gain of Acquirer

Go Gain of the Acquirer = Synergies Generated-(Price Paid for Target Company-Pre Merger Value of Target Company)

Post Merger EPS

Go Post Merger Eps = Total Earnings of the Acquirer Post Merger/Total Number of Shares of Acquirer

Control Premium

Go Control Premium = (Takeover Price-Market Price)/Estimated Price

Post Merger Share Price of Acquirer

Go Post Merger Share Price of Acquirer = Acquirer Pre Merger PE Ratio*Acquirer Post Merger Eps

Takeover Premium

Go Takeover Premium = Price Paid for Target Company-Pre Merger Value of Target Company

Post Merger PE

Go Post Merger Pe = Weighted Average Eps of Acquirer+Weighted Average Eps of Target

Merger Arbitrage Spread

Go Merger Arbitrage Spread = Risk Premium+Risk Free Rate

Post Merger PE Formula

Post Merger Pe = Weighted Average Eps of Acquirer+Weighted Average Eps of Target
PMP = WAEA+WAET

What do you mean by Post Merger PE ?

Post Merger PE is a valuation metric used by investors to assess the relative value of a company's stock compared to its earnings per share (EPS). The post-merger PE ratio provides insights into how the market values the company's stock to its earnings after the merger or acquisition has occurred. It reflects investor's sentiment regarding the combined entity's growth prospects, profitability, and overall performance following the completion of the merger or acquisition. A higher post-merger PE ratio may indicate that investors have optimistic expectations for the merged company's future earnings growth and are willing to pay a premium for its stock. Conversely, a lower post-merger PE ratio may suggest that investors have expectations about the merger's success or the combined company's ability to generate earnings.

How to Calculate Post Merger PE?

Post Merger PE calculator uses Post Merger Pe = Weighted Average Eps of Acquirer+Weighted Average Eps of Target to calculate the Post Merger Pe, Post Merger PE refers to the price to earnings ratio of a company after it has completed a merger or acquisition. Post Merger Pe is denoted by PMP symbol.

How to calculate Post Merger PE using this online calculator? To use this online calculator for Post Merger PE, enter Weighted Average Eps of Acquirer (WAEA) & Weighted Average Eps of Target (WAET) and hit the calculate button. Here is how the Post Merger PE calculation can be explained with given input values -> 1052.9 = 1.3+2.9.

FAQ

What is Post Merger PE?

Post Merger PE refers to the price to earnings ratio of a company after it has completed a merger or acquisition and is represented as PMP = WAEA+WAET or Post Merger Pe = Weighted Average Eps of Acquirer+Weighted Average Eps of Target. Weighted Average Eps of Acquirer reflects the combined earnings per share of the acquirer and the target, adjusted for their respective sizes in the post-merger entity & Weighted Average Eps of Target provides a weighted average Eps that reflects the combined earnings per share of the target and the acquirer.

How to calculate Post Merger PE?

Post Merger PE refers to the price to earnings ratio of a company after it has completed a merger or acquisition is calculated using Post Merger Pe = Weighted Average Eps of Acquirer+Weighted Average Eps of Target. To calculate Post Merger PE, you need Weighted Average Eps of Acquirer (WAEA) & Weighted Average Eps of Target (WAET). With our tool, you need to enter the respective value for Weighted Average Eps of Acquirer & Weighted Average Eps of Target and hit the calculate button. You can also select the units (if any) for Input(s) and the Output as well.

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