Question: Please show work with equations! This is extra information that I was given. Tot value firm = D + E Total firm value = FCF
Please show work with equations!
This is extra information that I was given.
Tot value firm = D + E
Total firm value = FCF1/(WACC - g)
25.4M/(.12 - .055) = $390,769,231
E = TV D = 390,769,231 250 = $140,769,231
Value per share = E/ #shares
$140,769,231/40m = $3.52 per share
- You must estimate the intrinsic value of Noe Technologies stock. The end-of-year free cash flow (FCF1) is expected to be $25.40 million, and it is expected to grow at a constant rate of 5.5% a year thereafter. The companys WACC is 12.0%, it has $250 million of long-term debt plus preferred stock outstanding, and there are 40 million shares of common stock outstanding. Assume the firm has zero non-operating assets. What is the firm's estimated intrinsic value per share of common stock? Watch your rounding.
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