and Options (7-11) Constant FCF Growth Valuation INTERMEDIATE PROBLEMS 11-21 Brook Corporation's free cash flow for the current year (FCF) was $3.00 million. Its investors require a 136 rate of return on (WACC133) What is the estimated value of operations if investors expect FCF to grow at a constant annual rate of (1) -5%, (2) 0%, linee cash flow is proiected to be (7-13) Free Cash Flow Valuation Dozier Corporation is a fast-growing supplier of office products. Analysts project the following free cash flows (FCFS) during the next 3 years, after which FCF is expected to grow at a constant 7% rate. Dozier's weighted average cost of capital is WACC = 13% Year 2 1 3 Free cash flow (millions of dollars) -$20 $30 $40 a. What is Dozier's horizon value? (Hint: Find the value of all free cash flows beyond Year 3 discounted back to Year 3.) b. What is the current value of operations for Dozier? c. Suppose Dozier has $10 million in marketable securities, $100 million in debt, and 10 million shares of stock. What is the intrinsic price per share? 7 10 bidanlatadito