The financial statements of Lioi Steel Fabricators are shown below, both the actual results for 2010 and

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The financial statements of Lioi Steel Fabricators are shown below, both the actual results for 2010 and the projections for 2011. Free cash flow is expected to grow at a 6% rate after 2011. The weighted average cost of capital is 11%.a. If operating capital as of 12/31/2010 is $502.2 million, what is the free cash flow for 12/31/2011?b. What is the horizon value as of 12/31/2011?c. What is the value of operations as of 12/31/2010?d. What is the total value of the company as of 12/31/2010?e. What is the intrinsic price per share for 12/31/2010?v Income Statements for the Year Ending December 31 (Millions of Dollars Except for Per Share Data)imageBalance Sheets for December 31 (Millions of Dollars)image

Financial Statements
Financial statements are the standardized formats to present the financial information related to a business or an organization for its users. Financial statements contain the historical information as well as current period’s financial...
Cost Of Capital
Cost of capital refers to the opportunity cost of making a specific investment . Cost of capital (COC) is the rate of return that a firm must earn on its project investments to maintain its market value and attract funds. COC is the required rate of...
Free Cash Flow
Free cash flow (FCF) represents the cash a company generates after accounting for cash outflows to support operations and maintain its capital assets. Unlike earnings or net income, free cash flow is a measure of profitability that excludes the...
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Corporate Finance A Focused Approach

ISBN: 978-1439078082

4th Edition

Authors: Michael C. Ehrhardt, Eugene F. Brigham

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