Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. finance
  3. an analyst is considering investing in kraft heinz

An analyst is considering investing in Kraft Heinz; a stock that generated free cash-flow (FCF)...

70.2K

Verified Solution

Question

Finance

An analyst is considering investing in Kraft Heinz; a stock that generated free cash-flow (FCF) of $2.6 billion last year. She estimates that earnings and FCFs will grow at a rate of -3% for the next 2 years, at 5% in the 5 years after, and at a constant rate of 4% after. She calculates the company's cost of capital at 6.25%. If the firm's non-operating assets are worth $0.6 billion, it has $32.8 billion in debt, and 1.22 billion shares outstanding, what is the analyst's fair value estimate of the company's common stock?

Select one:

a. $29.56

b. $47.19

c. $60.31

d. $63.29

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students

Calculus
1.2K views

Consider the function f x 9x Graph the exponential function by hand 2 2 Identify...

Finance
1.2K views

During 2018, Raines Umbrella Corp. had sales of $718,000. Cost of goods sold, administrative and selling...

Medical Sciences
1.2K views

Using approximately 400-500 words, describe which motions and muscles in the right elbow, forearm, wrist, and...

Biology
1.2K views

transport The action of the sodium potassium pump is an example of passive transport True...

Biology
1.2K views

Which of the following do all living things share?A. The same elementsB. The same shapeC....

Basic Math
1.2K views

The mean height of American women in their twenties is about 63.8 inches, and standard...

Algebra
1.2K views

In a particular year, a total of 59,130 students studied in two of the most...

Algebra
1.2K views

The graph of F x shown below in pink has the same shape as the...

Accounting
1.2K views

The management of Zigby Manufacturing prepared the following balance sheet for March 31. ...

Accounting
1.2K views

Because of its inability to control film and personnel costs in its radiology department, Sanger...

Accounting
1.2K views

Questions: 1. What is the net Form W-2 wages? 2. What is miscellaneous...

Accounting
1.2K views

Feather Friends, Inc., distributes a high-quality wooden birdhouse that sells for $80 per unit. Variable...