calaveras

Calaveras Vineyards1. Executive SummaryAs a smaller producer in the California wine industry, Calaveras Vineyards is somewhatcomplicated to compare to other, larger, producers. In analyzing the company we estimated thevalue of the company to be $9.972 million dollars. Its growth rate of 6.67% is considerablysmaller than that of identified competitors. The liquidation value of the company is estimated at$18.277 million dollars; almost double that of its estimated value. Many of the values of thecompany are greatly influenced by the market to book ratio of its equity. Although the book value of equity is listed at $1 million, the market value is thought to be much higher, at $2.62million. This estimate is greatly influenced by the market to book ratio of equity of competitors.2. Information SourcesNo outside information was used in this analysis. All information was obtained from withincompany data including information on the competition, industry, and financial market.3. Business descriptionCalaveras Vineyards occupied 80% of a total 200 acres in Alameda Valley, California. CalaverasVineyards was founded in 1883 by Esteban Calaveras whose family continued to own thevineyard until the 1970s. The winery and the vineyard provided table wines for sale to retailersand restaurants. Dramatic growth in demand for California wines and the entry of largecorporations in the production of California wines has resulted in the constant changes inownership and marketing of the Calaveras Vineyards since 1986. In spite of the many changes inmarketing and ownership, Calaveras has improved on its brand image and market position so theowners aimed at the premium brand segment of the market. As Calaveras executed its strategy of introducing premium wines with higher average prices, sales increased from $2.4 million in 1990to $2.8 million in 1991 and 1992. However sales dropped to $2.5 million in 1993 due in part totheir lack of representation by a sales organization.Most recently,