Question
38. ABC Corporation wanted to buy XYZ Corporation and wants to value it using DCF using the following table below. XYZs WACC is 10%. XYZs
38. ABC Corporation wanted to buy XYZ Corporation and wants to value it using DCF using the following table below. XYZs WACC is 10%. XYZs long term growth rate is 2% and its cost of equity is 12%. 2027 is the terminal year for ABCs forecast of XYZs FCFF forecast. What is XYZs present value for its FCFF for the first 4 years from 2023 to 2026?
2023 | 2024 | 2025 | 2026 | 2027 |
FCFF | FCFF | FCFF | FCFF | FCFF |
P 1 billion | P 2 billion | P 3 billion | P 4 billion | P 5 billion |
a. P 7.55 billion
b. P 8.95 billion
c. P 9.15 billion
d. P 10.45 billion
e. None of the above
39. ABC Corporation wanted to buy XYZ Corporation and wants to value it using DCF using the following table below. XYZs WACC is 10%. XYZs long term growth rate is 2% and its cost of equity is 12%. 2027 is the terminal year for ABCs forecast of XYZs FCFF forecast. What is XYZs terminal value?
2023 | 2024 | 2025 | 2026 | 2027 |
FCFF | FCFF | FCFF | FCFF | FCFF |
P 1 billion | P 2 billion | P 3 billion | P 4 billion | P 5 billion |
a. P 12.75
b. P 34.89
c. P 48.00
d. P 50.00
e. P 62.00
f. None of the above
40. ABC Corporation wanted to buy XYZ Corporation and wants to value it using DCF using the following table below. XYZs WACC is 10%. XYZs long term growth rate is 2% and its cost of equity is 12%. 2027 is the terminal year for ABCs forecast of XYZs FCFF forecast. What is XYZs value per share if it has 1 billion shares?
2023 | 2024 | 2025 | 2026 | 2027 |
FCFF | FCFF | FCFF | FCFF | FCFF |
P 1 billion | P 2 billion | P 3 billion | P 4 billion | P 5 billion |
a. P 21.89
b. P 37.46
c. P 41.70
d. P 58.52
e. None of the above
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