Stout was engaged by a supply chain and management software company to issue a solvency opinion on the ability of the company to remain solvent following the payment of a dividend to shareholders.

Our analysis relied on projected cash flows via a discounted cash flow analysis as well as an analysis of the trading multiples of publicly traded companies. We conducted a cash flow test analysis to determine the ability for the entities to satisfy their post-transaction debt obligations.

The analysis also presented a downside case scenario to provide management with a sensitivity analysis on the company’s ability to continue satisfying its debt obligations in the event of unexpected business pressures resulting in lower-than-expected future cash flows.