Estimating Share Value Using the DCF Model Assume following are forecasts of Abercrombie & Fitch's sales, net operating profit after tax (NOPAT), and net operating assets (NOA) as of January 29, 2011. Reported Horizon Period (In millions) 2011 2012 2013 2014 2015 Terminal Period Sales $ 3,750 $ 4,500 $5,400 $ 6,480 $ 7,776 $ 7,853 NOPAT 464 582 650 965 995 NOA 1,359 1,631 1,935 2.311 2.760 2,826 818 Answer the following requirements assuming a discount rate (WACC) of 13.3%, a terminal period growth rate of 1%, common shares outstanding of 86.2 million, and net nonoperating obligations (NNO) of $(279) million (negative NNO reflects net nonoperating assets such as investments rather than net obligations). (a) Estimate the value of a share of Abercrombie & Fitch common stock using the discounted cash flow (DCF) model as of January 29, 2011. Rounding instructions: Round answers to the nearest whole number unless noted otherwise. Use your rounded answers for subsequent calculations. Horizon Period 2013 2014 2015 Terminal Period OX 0 x 0 x OX 0 x OX 0x 0 x Ox Ox OX 0 x 0 x 0x Do not use negative signs with any of your answers. Reported (In millions) 2011 2012 Increase in NOA OX FCFF (NOPAT - Increase in NOA) OX Discount factor [1/(1 + rw'] (round to 5 decimal places) 0 x Present value of horizon FCFF Ox Cum present value of horizon FCFF $ 0x Present value of terminal FCFF OX Total firm value 0x NNO 0 x Firm equity value $ 0X Shares outstanding (millions) 0x (round one decimal place) Stock price per share $ 0 (round two decimal places) Estimating Share Value Using the DCF Model Assume following are forecasts of Abercrombie & Fitch's sales, net operating profit after tax (NOPAT), and net operating assets (NOA) as of January 29, 2011. Reported Horizon Period (In millions) 2011 2012 2013 2014 2015 Terminal Period Sales $ 3,750 $ 4,500 $5,400 $ 6,480 $ 7,776 $ 7,853 NOPAT 464 582 650 965 995 NOA 1,359 1,631 1,935 2.311 2.760 2,826 818 Answer the following requirements assuming a discount rate (WACC) of 13.3%, a terminal period growth rate of 1%, common shares outstanding of 86.2 million, and net nonoperating obligations (NNO) of $(279) million (negative NNO reflects net nonoperating assets such as investments rather than net obligations). (a) Estimate the value of a share of Abercrombie & Fitch common stock using the discounted cash flow (DCF) model as of January 29, 2011. Rounding instructions: Round answers to the nearest whole number unless noted otherwise. Use your rounded answers for subsequent calculations. Horizon Period 2013 2014 2015 Terminal Period OX 0 x 0 x OX 0 x OX 0x 0 x Ox Ox OX 0 x 0 x 0x Do not use negative signs with any of your answers. Reported (In millions) 2011 2012 Increase in NOA OX FCFF (NOPAT - Increase in NOA) OX Discount factor [1/(1 + rw'] (round to 5 decimal places) 0 x Present value of horizon FCFF Ox Cum present value of horizon FCFF $ 0x Present value of terminal FCFF OX Total firm value 0x NNO 0 x Firm equity value $ 0X Shares outstanding (millions) 0x (round one decimal place) Stock price per share $ 0 (round two decimal places)