Question 15 14 points Save Answer (Lecture 8 - Stock Valuation - Discounted Free Cash Flow model) Assume you have a company that has the following financials for fiscal year 2020: $975 million in cash $636 million in book value of debl $456 million in market value of debt The company is expected to generate a free cash flow of $200 million in 2021. The growth rates of the free cash flows will be 4% in 2022 (e. g., Year 2022 FCF = (1+4%) "Year 2021 FCF), 2% in 2023 (e.g., Year 2023 FCF = (1+2%) *Year 2022 FCF), and -3% (yes, negative growth rate) per year after 2023. If the firm's weighted average cost of capital is 10% and the firm has 200 million shares outstanding in 2020, then after its 2020 annual report is released to the public, the firm's equity value per share is $_ Instruction: Type ONLY your numerical answer in the unit of dollars, NO $ sign needed, No comma sign. Round to the nearest two decimal places. E g., if your answer is $18.768 then input 18.78
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!
