Where-U-From is a publicly listed firm that offers subscribers access to online information regarding their ancestry....

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Where-U-From is a publicly listed firm that offers subscribers access to online information regarding their ancestry. The company recently has struck several deals to digitize population records across the world. Where-U-From is entering a fast growth phase, which is expected to last for 5 years. The following table contains reported income statement information for the most recent year 2023 (all numbers are in $1,000s): Year Revenues 2023 8,000 Operating Costs (incl. Depreciation) 6.400 EBIT 1,600 Interest expense 780 EBT 820 Taxes 205 Net Income 615 Detailed projections (in $1,000s) for the years 2024-2028 are given below: Expected growth in revenues is 50% per year. Operating profit (EBIT) equals 20% of revenues in each of the years 2024-2028. The increase in net working capital equals 5% of revenues in each of the years 2024-2028. Gross investments in fixed assets equal $3,400 in each of the years 2024-2028. The amount of depreciation is equal to $1,700 in each of the years 2024-2028. Where-U-From currently has 0.9 million shares outstanding and has a debt ratio of 30% in market value terms. The firm has a BBB bond rating and its equity beta equals 1.92. The interest rate on T-bonds equals 4.5%, the expected yield on BBB-rated bonds is 5.70% and the market risk premium is 6%. Finally, you can assume that all cash flows will be realized at the end of the year and that the firm is subject to a 25% marginal corporate tax rate. With this information answer the following four questions. (i) Determine the relevant cash flows for a valuation of the firm for the years 2024-2028 (in $1,000s). Show your calculations. (10 points) (ii) Calculate the weighted average cost of capital for Where-U-From. Show all your calculations. points) (iii) Determine Where-U-From's business risk. Show all your calculations. (10 points) Where-U-From is a publicly listed firm that offers subscribers access to online information regarding their ancestry. The company recently has struck several deals to digitize population records across the world. Where-U-From is entering a fast growth phase, which is expected to last for 5 years. The following table contains reported income statement information for the most recent year 2023 (all numbers are in $1,000s): Year Revenues 2023 8,000 Operating Costs (incl. Depreciation) 6.400 EBIT 1,600 Interest expense 780 EBT 820 Taxes 205 Net Income 615 Detailed projections (in $1,000s) for the years 2024-2028 are given below: Expected growth in revenues is 50% per year. Operating profit (EBIT) equals 20% of revenues in each of the years 2024-2028. The increase in net working capital equals 5% of revenues in each of the years 2024-2028. Gross investments in fixed assets equal $3,400 in each of the years 2024-2028. The amount of depreciation is equal to $1,700 in each of the years 2024-2028. Where-U-From currently has 0.9 million shares outstanding and has a debt ratio of 30% in market value terms. The firm has a BBB bond rating and its equity beta equals 1.92. The interest rate on T-bonds equals 4.5%, the expected yield on BBB-rated bonds is 5.70% and the market risk premium is 6%. Finally, you can assume that all cash flows will be realized at the end of the year and that the firm is subject to a 25% marginal corporate tax rate. With this information answer the following four questions. (i) Determine the relevant cash flows for a valuation of the firm for the years 2024-2028 (in $1,000s). Show your calculations. (10 points) (ii) Calculate the weighted average cost of capital for Where-U-From. Show all your calculations. points) (iii) Determine Where-U-From's business risk. Show all your calculations. (10 points)