Find the present value of flows 2 Assumptions: 3 Revenue Growth (%) COGS/sales (%) SG&A/Sales (%) 5

Find the present value of flows

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2 Assumptions: 3 Revenue Growth (%) COGS/sales (%) SG&A/Sales (%) 5 Tax Rate (%) Current Asset/Sales(%) 3 Current liabilities/sales (%) 9 Yearly depreciation and capax equal each other. 0 Cost of Capital (%) 1 Terminal Growth Rate (%) 2 3 4 5 Discounted Cash Flow 6 (In millions of dollars except per-share data) 7 8 Operating Income 9 Taxes 0 NOPAT 1 2002 2 Capex, not of depreciation 3 Change NWC 4 Free Cash Flow 5 6 Terminal Value 7 Total Flows 8 Present Value of Flows 9 0 The tax rate that was taken was the same as what Joanna Cohen took which was computed by adding the US statutory tax rate with the state taxes (35%+3% = 1 38%), so the tax rate taken is 38%. 2 (1-T) + We x Re 3 =10.19% x 7.16% x (1-38%) + 89.81% x9.811% 49.264%. 2003 7 60 28 38 38 11.5 12 3 8.8 $764.20 2004 764.2 6.5 60 27.5 38 38 11.5 2005 6.1 59.5 27 38 38 11.5 663.1 2006 6.5 59.5 26.5 777.5 38 38 11.5 2007 6 59 26 38 38 11.5 2008 6 59 25 38 38 11.5 2009 6 58.5 25 38 38 11.5 2010 6 58.5 25 38 38 11.5 $1,218.40 $1,351.60 $1,554.60 $1,717.00 $1,950.00 $2,135.90 $2,410.20 $2,554.80 $2,790.10 $2,957.50 ($463.00) ($513.60) ($590.80) ($652.50) ($741.00) ($811.70) ($915.90) ($970.80) ($1,060.20) ($1,123.90) $755.40 $838.00 $963.80 $1,064.50 $1,209.00 $1,324.20 $1,494.30 $1,584.00 $1,729.90 $1,833.60 2011 6 58 25 38 38 11.5 6 58 25 38 38 11.5 -232.3 -246.2 -261 -174.9 -186.3 -198.4 -195 -206.7 -219.1 $663.10 $777.50 $866.10 $1,014.00 $1,117.50 $1,275.20 $1,351.70 $1,483.70 $1,572.60 866.1 1,014.00 1,117.50 1,275.20 1,351.70 1,483.70 $1,572.60 2 Assumptions: 3 Revenue Growth (%) COGS/sales (%) SG&A/Sales (%) 5 Tax Rate (%) Current Asset/Sales(%) 3 Current liabilities/sales (%) 9 Yearly depreciation and capax equal each other. 0 Cost of Capital (%) 1 Terminal Growth Rate (%) 2 3 4 5 Discounted Cash Flow 6 (In millions of dollars except per-share data) 7 8 Operating Income 9 Taxes 0 NOPAT 1 2002 2 Capex, not of depreciation 3 Change NWC 4 Free Cash Flow 5 6 Terminal Value 7 Total Flows 8 Present Value of Flows 9 0 The tax rate that was taken was the same as what Joanna Cohen took which was computed by adding the US statutory tax rate with the state taxes (35%+3% = 1 38%), so the tax rate taken is 38%. 2 (1-T) + We x Re 3 =10.19% x 7.16% x (1-38%) + 89.81% x9.811% 49.264%. 2003 7 60 28 38 38 11.5 12 3 8.8 $764.20 2004 764.2 6.5 60 27.5 38 38 11.5 2005 6.1 59.5 27 38 38 11.5 663.1 2006 6.5 59.5 26.5 777.5 38 38 11.5 2007 6 59 26 38 38 11.5 2008 6 59 25 38 38 11.5 2009 6 58.5 25 38 38 11.5 2010 6 58.5 25 38 38 11.5 $1,218.40 $1,351.60 $1,554.60 $1,717.00 $1,950.00 $2,135.90 $2,410.20 $2,554.80 $2,790.10 $2,957.50 ($463.00) ($513.60) ($590.80) ($652.50) ($741.00) ($811.70) ($915.90) ($970.80) ($1,060.20) ($1,123.90) $755.40 $838.00 $963.80 $1,064.50 $1,209.00 $1,324.20 $1,494.30 $1,584.00 $1,729.90 $1,833.60 2011 6 58 25 38 38 11.5 6 58 25 38 38 11.5 -232.3 -246.2 -261 -174.9 -186.3 -198.4 -195 -206.7 -219.1 $663.10 $777.50 $866.10 $1,014.00 $1,117.50 $1,275.20 $1,351.70 $1,483.70 $1,572.60 866.1 1,014.00 1,117.50 1,275.20 1,351.70 1,483.70 $1,572.60