4. Fast food company You have been assigned to estimate a fair price of the stock of the Belgium fast food company EXXi of today. You have been given the following information for EXXi for the most recent year: - EUR 23 million in after-tax operating income - EUR 12 million in capital expenditures - EUR 6 million in depreciation - EUR 5 million increase in non-cash working capital You spend the first couple of days try to figure out what the future looks like for Exxi and came up with the following estimations: For the prognostic period (the first 3 years) you estimate that: - The after-tax operating income, capital expenditures, and depreciation all are expected to grow 12% a year for the next 3 years. The change in the non-cash working capital will increase by 120 % per year for each year during the 3 years. - The cost of capital is 11% For the remaining years (terminal value) you estimate that: - The growth rate will drop to 3% but you anticipate that the return on capital will stay stable at the same level that the firm maintained during the high growth period. - Also the cost of capital is anticipated to drop to 10% Further, the firm has EUR 100 million in debt, EUR 20 million as a cash balance and 10 million shares outstanding. The corporate tax rate is 30%. QUESTION 4 You have been assigned to estimate a fair price of the stock of the Belgium fast food company EXXI of today. You have been given the following information for LXXt for the most recent year - EUR 23 million in after tax operating income -EUR 12 million in capital expenditures - EUR 6 million in depreciation - EUR 5 million increase in concis working capital You sperad the first couple of days try to figure out what the future books like for EXXi and came up with the following estimations For the prognostic period (the flest years you estimate that The after-tax operating income, capital expenditures, and depreciation all are expected to grow 12% a year for the next 3 years The change in the month working capital will increase by 120 per year for each year during the years The cost of capital is 119. For the remaining years (minal value you that The growth rate will drop to 3 but you anticipate that the retum en capital will stay stable at the same level that the flow maintained during the high growth period. -Abo the cost of capital is anticipated to drop to 30% Panther, the film hon 100 million in debt, WUR 20 million macuh halance and 10 million shares ondoy. The corpore ex eis 2016