Question: All parts please P7-18 (similar to) Question Help * Using the free cash flow valuation model to price an IPO Personal Finance Problem Assume that

P7-18 (similar to) Question Help * Using the free cash flow valuation model to price an IPO Personal Finance Problem Assume that you have an opportunity to buy the stock of CoolTech, Inc., an beng offered for $26.78 per share. Al hough you are very much interested in owning the company, you are concerned about whether t is faith p ced To deter m e the value of the shares, you have decided to apply the free cash flow valuation model to the firm's financial data that you've accumulated from a variety of data sources The key values you have compiled are summarized in the following table, EEB a. Use the free cash flow valuation model to estimate CoolTech's common stock value per share. b. Judging by your finding in part a and the stock's offering price, should you buy the stock? b7 c. On further analysis, you find that the g owth rate in FCF beyond 2023 will be 7% rather than 6%, what effect would this finding have on your responses in parts a and a. The value of CoolTech's entire company is $(Round to the nearest dollar.) Entor your answer in the answer box and then click Check Answer parts remaining Clear Al Check Answer P7-18 (similar to) Question Help Using the free cash flow v IPO being offered for the value of the Finance Problem of CoolTech, Inc., an fairly priced. To determine n modelt Data Table Xa variety of data sources. The key values you a. Use the free cash b. Judging by your f c. On further analysis, b? Click on the ioon located on the top-right corner of the data table below in order to copy its contents intoa spreadsheet.) responses in parts a and Free cash flow Year (t) 2020 2021 2022 2023 a. The value of CoolT FCF Other data $700,000 | Growth rato of FCF, beyond 20 23 to infinity "6% $780,000 | weighted average cost of capital 896 $930.000 Market value of all debt $8,980,000 $1,080,000 Market value of preferred stock $3,590,000 Number of shares of common stock to be issued 1.100,000 Print Done Enter your answer in parts Clear All Check
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