Question: Use the table for the question(s) below. 1 270 ECF Forecast (5 million Year 0 Sales 200 Growth versi Prior Year 125 EBIT (10% of
Use the table for the question(s) below. 1 270 ECF Forecast (5 million Year 0 Sales 200 Growth versi Prior Year 125 EBIT (10% of Sales) 2700 Les Income Tax (2005) (5.40) Less Increase in NWC (12% of Change in Sales) 360 Free Cash How 1800 2 290 7.4% 2900 5.80 2.40 3 310 6.9% 3100 6:20 2:10 2240 4 325 5 50% 3255 651 186 24.18 2080 Banco Industries expect sales to grow at a rapid rate over the next three years, but settle to an industry growth rate of 7% in year 4. The spreadsheet above shows a simplified proforma for Banco Industries. Il Banco Industries has a welghted average cost of capital of 10%. $30 million in cash, 560 milion in debt, and 18 million shares outstanding, which of the following is the best estimate of Banco's stock price at the start of year 1? A $3478 B 517.39 O 05626 OD 5313
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