Question: Show me the steps to solve Question to answer:Compare the estimated share price from your DCF model to the current traded share price and provide
Show me the steps to solve Question to answer:Compare the estimated share price from your DCF model to the current traded share price and provide a recommendation to buy, hold or sell your chosen company's shares, clearly stating why.
Your recommendation should be supported by arguments that discuss the differences between the estimated share price from your DCF model and the market price with regard to the assumptions you have made in your DCF model and the risk analysis you performed in questions and below.
I want you to specifcally reference the data below fromQ and tell me how the DCF model cash flows, NPV and estimated share price and WACC after tax that makes the NPV and the long term growth rate that makes the NPV can help support my recommendation. Further tell me how the sensitivity analysis with the long run growth rate and WACC after tax can help make my recommendation.
Q
PV of the terminal value:
PV of FCFF for each year to Calculate using above data, ensure WACC after tax from Qg is used:
Enterprise value:
Cash retrieve from the balance sheet:
Equity value:
Estimated DCF share price in dollars per one share:
NPV in dollars of buying one share calculate based on above data:
Question
Find the WACC after tax that makes the NPV zero: Answer is
Question
Find the longterm growth rate that makes the NPV zero Answer is
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