4. Carebnb Co. (CBNB) is a competitor of Airbnb. The difference is CBNB focuses on...
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4. Carebnb Co. (CBNB) is a competitor of Airbnb. The difference is CBNB focuses on senior clients who are 50 or above. The company most recent free cash flow (FCFO) was $1.2 million. CBNB expects to have FCF growth of 2 percent in Year 1,25 percent in Year 2 and 1.5 percent thereafter. CBNB's current debt and preferred stock together is $15 million. Total shares outstanding are 1.2 million. WACC is 5 percent. What is CBNB intrinsic value? If the current price in the stock market of CBNB now is $13, will you buy? Why? 10 points) Note: make sure that you answer three questions. [10 points)
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