Question: please show work in excel E-Board is a new company that sells electronic hoverboards. After studying this form for many weeks, you have come up
please show work in excelE-Board is a new company that sells electronic hoverboards. After studying this form for many weeks, you have come up with the following free cash flow projections for the next three years (the year 1 FCF arrives in exactly 1 year): 1 2 FCF (Smil) 20 33 Year 0 3 0 44 FCF in years 4-10 will be 10% higher than in the previous year (so year 4 will be 48.4. for example) FCF in year 11 will be 4% higher than in year 10, and this 4% growth rate will continue forever. E-Board has roughly equal amounts of cash and debt on its balance sheet: Shareholder's Equity on E-Board's balance sheet is $195 million Its CAPM beta is 2.10 and debt yield to maturity is 6.8%. Assume the market risk premium is 5% The 1-year U.S. Treasury bill has a yield to maturity of 0.10%, the 5-year Treasury bond yield is 0.42%, and the 30-year Treasury bond yield is 1.73% E-Board's tax rate is 21%. E-Board has 9 million shares outstanding a) What is your best estimate of E-Board's stock price? b) The current price of this stock is $88. Would you sell your stores in this company or buy more! Question 5 5 pts Your friend is new to investing in the stock market She wants to begin saving for retirement and is considering two mutual funds. One is an S&P 500 passive index fund, and the other is an actively managed stock fund that beat the S&P 500 by 7% last year. What advice would you give her? Assume you want the best for this friend Edit View insert Format Tools Table 12ptParagraph B I U 2 T 5 P
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