You expect CCM Corporation to generate the following free cash flows over the next five years:...

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You expect CCM Corporation to generate the following free cash flows over the next five years: Year FCF ($ millions) 1 25 2 28 3 32 4 37 5 40 Following year five, you estimate that CCM's free cash flows will grow at 5% per year and that CCM's weighted average cost of capital is 13%. If CCM has $200 million of debt, $20 million cash and 8 million shares of stock outstanding, then the share price for CCM is? You expect CCM Corporation to generate the following free cash flows over the next five years: Year FCF ($ millions) 1 25 2 28 3 32 4 37 5 40 Following year five, you estimate that CCM's free cash flows will grow at 5% per year and that CCM's weighted average cost of capital is 13%. If CCM has $200 million of debt, $20 million cash and 8 million shares of stock outstanding, then the share price for CCM is?

Answer rating: 100% (QA)

Step 1 Calculate the present value of the free cash flows for years 15 usin... View the full answer