Question: This is all the information i am given: You are building a free cash flow to the firm model. You expect sales to grow from
This is all the information i am given:
You are building a free cash flow to the firm model. You expect sales to grow from $1 billion for the year that just ended to $1.7 billion five years from now. Assume that the company will not become any more or less efficient in the future. Use the following information to calculate the value of the equity on a per-share basis. a. Assume that the company currently has $300 million of net PP&E. b. The company currently has $100 million of net working capital. c. The company has operating margins of 10 percent and has an effective tax rate of 32 percent. d. The company has a weighted average cost of capital of 9 percent. This is based on a capital structure of two-thirds equity and one-third debt. e. The firm has 2 million shares outstanding. Do not round intermediate calculations. Round your answer to the nearest cent. $ You are building a free cash flow to the firm model. You expect sales to grow from $1 billion for the year that just ended to $1.7 billion five years from now. Assume that the company will not become any more or less efficient in the future. Use the following information to calculate the value of the equity on a per-share basis. a. Assume that the company currently has $300 million of net PP&E. b. The company currently has $100 million of net working capital. c. The company has operating margins of 10 percent and has an effective tax rate of 32 percent. d. The company has a weighted average cost of capital of 9 percent. This is based on a capital structure of two-thirds equity and one-third debt. e. The firm has 2 million shares outstanding. Do not round intermediate calculations. Round your answer to the nearest cent. $
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