The most recent free cash flow (FCF) for Golden Enterprises was $200 million, and the...
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The most recent free cash flow (FCF) for Golden Enterprises was $200 million, and the management expects the free cash flow to begin growing immediately at a 7% constant rate. The cost of capital is 12%.
i. Using the constant growth model, determine the value of operations for Golden Enterprises Inc.
Golden Enterprises Inc. balance sheet shows that it has $10 million short-term investments, $15 million in notes payable, $60 million in long-term bonds, and $15 million in preferred stock. Golden Enterprises has 60 million of shares outstanding. Calculate the following:
ii. total intrinsic value for Golden Enterprises Inc.
iii. intrinsic value of equity for Golden Enterprises Inc.
iv. intrinsic stock price per share for Golden Enterprises Inc.
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