Year 1 2 3 4 Free Cash Flow $12 million $18 million $22 million $26...
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Accounting
Year 1 2 3 4
Free Cash Flow $12 million $18 million $22 million $26 million
Conundrum Mining is expected to generate the above free cash flows over the next four years, after which they are expected to grow at a rate of 5% per year. If the weighted average cost of capital is 11% and Conundrum has cash of $85 million, debt of $65 million, and 30 million shares outstanding, what is Conundrums expected current share price?
A) $12.61
B) $16.40
C) $20.18
D) $20.81
I know how to find FCF5(27.3) and Terminal EV at year 4 (455), but how do I find Terminal EV at year 0 using a BA II Plus calculator?
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