Question: use finacial graphy, finacial model. use FCF / EBITDA valuation model A Credit Suisse First Boston financial analyst is evaluating Relant home furnishings by using
A Credit Suisse First Boston financial analyst is evaluating Relant home furnishings by using FCF valuation with EBITDA. He has accumulated the following information as of 2016 : - Current Sales is $3,000 million - Sales growth rate forecasts =15% for two years (20172018) and 7% annual thereafter - COGS is 50% of Sales - Depreciation is fixed at 6% of Sales - Corporate tax rate is 21% - Investment in Fixed Capital (FC) =30% of Increase in Sales - Investment in Fixed Capital (WC) =10% of Increase in Sales - WACC=10% Please estimate enterprise value using FCF/EBITDA valuation model. (You need to show your statement, financial graph, financial models and work to get full credit)
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