A company is projected to generate free cash flows of $114 million per year for the...

Transcribed Image Text:

A company is projected to generate free cash flows of $114 million per year for the next 3 years (FCFF1, FCFF2 and FCFF3). Thereafter, the cash flows are expected to grow at a 2.8% rate in perpetuity. The company's cost of capital is 7.7%. What is your estimate for its enterprise value? Answer in millions, rounded to one decimal place (e.g., $213,456,789 = 213.5). A company is projected to generate free cash flows of $114 million per year for the next 3 years (FCFF1, FCFF2 and FCFF3). Thereafter, the cash flows are expected to grow at a 2.8% rate in perpetuity. The company's cost of capital is 7.7%. What is your estimate for its enterprise value? Answer in millions, rounded to one decimal place (e.g., $213,456,789 = 213.5).

Answer rating: 100% (QA)

To estimate the enterprise value of the company we can use the discounted cash flow DCF method The e... View the full answer