19.

The following data apply to the next three questions Delta Industries has 50 million outstanding shares, 5100 million in debt, $40 million in cash, and the following projected free cash flow to the firm (FCFF) for the next four years: 0 1 2 3 4 4330 3 5 ON 384.80 Year Earnings and FCF Forecast (5 millions) 1 Sales 2 Growth versus Priorar 3 Cost of Goods Sold 4 Gross Profit 5 Selling. General and Administrative 6 Depreciation 7 EBIT 8 Less: Income Tax at 10% 9 Plus: Depreciation 10 Les Capital Expenditures 11 Less Increase in NWC 12 Free Cash Flow 1980 2.1% 313.61 1544 193.61 1701 1995 5160 10.3% (345.73 1703 1103 21 1750 696 238 75 110.08 186 24.6 5470 6.ON 366.53 180.5 (109.41 20 821 (248 90 09 15.6 30.8 215 70 1271 16.31 253 195 6652 (261) 95 0104 49 333 Suppose Delta's revenue and free cash flow are expected to grow at a 5% rate beyond year 4. If Delta's weighted average cost of capital (WACC) is 12%, of 24 What is your estimate of the Terminal Value (TV) of Delta Industries based on this information? O a $385.7 million O b. $437.8 million Oc. $456.3 million d. $499.5 million e. None of the above asure