estimating share value usinf ropi

Estimating Share Value Using the ROPI Model Following are forecasts of sales, net operating profit after tax (NOPAT), and net operating assets (NOA) as of February 26, 2011, for Best Buy, Inc. Reported Horizon Period (In millions) 2011 2012 2013 2014 2015 Terminal Period Sales $50,272 $52,786 $55,425 $58,196 $61,106 $61,717 NOPAT 1,389 1,584 1,663 1,746 1,833 1,852 NOA 7,876 8,248 8,660 9,093 9,548 9,643 Answer the following requirements assuming a discount rate (WACC) of 11%, a terminal period growth rate of 1%, common shares outstanding of 392.6 million, net nonoperating obligations (NNO) of $1,274 million and noncontrolling interest (NCI) on the balance sheet of $690 million. (a) Estimate the value of a share of Best Buy's common stock using the residual operating income (ROPI) model as of February 26, 2011. Rounding Instructions: . Round your answer to the nearest whole number except for the discount factors, shares outstanding, and the stock price per share. Round the discount factors to five decimal places, common shares outstanding to one decimal place, and the stock price to two decimal places. Use your rounded answers for subsequent calculations.Do not use negative signs with any of your answers below. Reported Horizon Period BBY (In millions) 2011 2012 2013 2014 2015 Terminal Period ROPI (NOPAT - [NOABeg * [wl) 0 x 0 x 0 x 0 x 0 X Discount factor [1/(1+rw)t] (round 5 decimal places) 0 x 0 x 0 x 0 x Present value of horizon ROPI 0 x 0 x 0 x 0 x Cum present value of horizon ROPI $ 0 x Present value of terminal ROPI 0 x NOA 0 X Total firm value 0 x NNO 0 x NCI 0 X Firm equity value 13,105.98 x Shares outstanding (millions) 396.2 x (round one decimal place) Stock price per share $ 33.38 x (round two decimal places)