222 3 The purpose of this section is to forecast Unlevered Net Income for Zeel Corp for the current year (2021). Use the assumptions given to complete the analysis and then fill in all shaded cells on the answer chart Assumptions: Forecast Sales Growth Rate (annual) 2 marks per answer (Total of 6) Complete the following chart: Year 1 2021 Year 2 2022 -3.00% 1.50% Year 3 2023 Year 4 2024 Year 5 2025 Sales in 2020 (billions) FCF Growth in Perpetuity Interest Expense as a % of Sales Marketing as a % of Sales 2.00% 4.00% What is Zeel Corp's forecast sales for 2021? (billions) What is Zeel Corp's forecast Gross Profit for 2021? (billions) What is Zeel Corp's forecast Unlevered Net Income for 2021? (billions) 3.00% 20.00 2.50% 7.00% 5.00% Direct Labour as a % of Sales 10.00% General administrative expenses as a % of Sales 19.00% Tax Rate 21.50% Raw materials as a % of Sales 30.00% Terminal EBITDA Multiple 11.00 Net Working Capital as of the end of 2020 (millions) 360 NWC as a % of Sales 1.8% Capital Expenditures as a % of Sales 5.4% Cash (billions) 25 Debt (billions) 400 Current Share price 271.00 Shares Outstanding (billions) 10.00 Weighted average cost of capital Rwacc 9.00% 1 Given the Networking Capital forecasts for Total Corp over the next 5 years, calculate the Net Present Value of the impact on the company's free cash flow projections. The Company's weighted average cost of capital is 8%. Fill in the shaded cells. Net Working Capital Projections NWC Year just ended 10,000 2 10, 200 10, 400 Forecast Year 3 10, 100 4 10, 300 9, 500 a) NPV b) 2 marks Will the Networking Capital requirements increase or decrease the Company's forecast free cashflow? 1 mark 2 The purpose of this section is to complete an analysis on United Health Group and determine an estimate of the intrinsic value of the company. Use the assumptions given to complete the analysis and then fill in all shaded cells on the answer chart below. Assumptions: Complete the following chart: 2 marks per answer (Tota Forecast FCF Growth Rate (annual) Year 1 2021 1.00% Year 2 2022 1.50% Year 3 2023 2.00% What is United Health Group's current Market Capitalization of equity? (billions) What is the forecast FCF in 2021? (billions) Year 4 2024 4.00% Year 5 2025 3.00% What is the forecast terminal value of the FCF in 2025 using growth in perpetuity? (billions) What is the forecast Enterprise Value of the Company today? (billions) FCF in 2020 (billions) 11.16 What is the forecast implied equity value today? (billions) FCF Growth in Perpetuity 2.50% What is the intrinsic value of the shares today? COGS as a % of Revenue 65.00% SG&A as a % of Revenue 19.00% Tax Rate 21.50% Forecast EBITDA 2025 (billions) 21.20 Terminal EBITDA Multiple 12.40 Net Working Capital as of the end of 2020 (millions) 628 NWC as a % of Revenue 1.8% Capital Expenditures as a % of Revenue 5.4% Cash (billions) 9 Debt (billions) 11 Current Share price 13.00 Shares Outstanding (billions) 15.00 Weighted average cost of capital Rwacc 8.00% 3