NIKE, Inc. is an American multinational corporation that is engaged in the design, development, manufacturing, and worldwide
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NIKE, Inc. is an American multinational corporation that is engaged in the design, development, manufacturing, and worldwide marketing and sales of footwear, apparel, equipment, accessories, and services. The company is headquartered near Beaverton, Oregon, in the Portland metropolitan area. It is the world's largest supplier of athletic shoes and apparel and a major manufacturer of sports equipment, with revenue in excess of US$ 24.95 billion in its fiscal year 2019 (ending May 31, 2019). Using the data provided in Value Line sheet (use the forecasted data for 2020 and the data in the last column as data for 2024 only), answer the following questions:
- 1. Assuming that the market risk premium is 5% and the risk free rate is 3%. What is NIKE's weighted average cost of capital?
- 2%
- 3%
- 5%
- 7%
- 2. NIKE's P/E ratio using 2020 earnings per share estimate and current stock price is closest to:
- 2
- 10
- 40
- 93
- 3. Companies in the Footwear & Accessories Industry trade at an average P/E ratio of 35. NIKE's implied share price is closest to?
- $65
- $51
- $71
- $91
- 4. What is the FCFF in 2020 if the marginal tax rate is 21%?
- $2,520 million
- $5,370 million
- $4,251 million
- $9,705 million
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