Ratched Medical Supplies (RMS) is a fast-growing supplier of health care equipment. Because the firm is growing,
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Ratched Medical Supplies (RMS) is a fast-growing supplier of health care equipment. Because the firm is growing, you project FCF for the upcoming year to be negative, but expect a return to positive in the following year. Your forecast of FCF for the next three years is: Year 1 2 3 FCF ($ millions) -25 30 45 After year 3, you expect FCF to grow at a constant 8% per year. RMS's weighted average cost of capital is 15% and the firm has $10 million in short-term investments that are unrelated to operations, $100 million in debt, $20 million in preferred stock, and 15 million shares of common stock.
What is the intrinsic value per share of common?
Related Book For
Income Tax Fundamentals 2013
ISBN: 9781285586618
31st Edition
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill
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