Equity Research
A company targets growing market share from 10% to 12% in a market growing 5% a year. What revenue growth does that require?
Model answer
Index the market to 100: it grows to 105. The company today has revenue of 10 (10% share); at 12% share of the new market it needs 12% x 105 = 12.6. Required growth is 12.6 / 10 − 1 = 26% — five…
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