Valuation Using the PB Multiple The following table provides summary data for Cerner Corporation (CERN) and its competitors, Allscripts Healthcare Solutions (MDRX) and McKesson (MCK).

(in millions)	CERN	MDRX	MCK
Company assumed value	--	$1,960	$23,685
Equity assumed value	--	$1,624	$21,268
Net operating assets	$1,484	$1,620	$ 9,487
Book value of equity	$2,834	$1,284	$ 7,070
Net nonoperating obligations (assets)	$(1,350)	$ 336	$ 2,417
Common shares outstanding	172.1 shares	172.4 shares	197.0 shares

(a) Compute the PB ratio for both MDRX and MCK. (Round your answers to two decimal places.) MDRX Answer

MCK Answer

(b) Use MDRX and MCK as comparables, along with the rounded PB ratios from part (a), and then estimate for Cerner its equity intrinsic value and its equity intrinsic value per share. (Round the equity intrinsic value to the nearest million and the value per share to the nearest cent.) Average of the two rounded ratios in (a) above Answer

(Round to two decimal places.)

Using the rounded average calculated above, calculate the following: Equity intrinsic value $Answer

million Equity intrinsic value per share $Answer

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