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5 . You have the following information to determine the per share value of a stock using the free cash flow ( FCF ) method
You have the following information to determine the per share value of a stock using the free cash flow FCF method of valuation:
The firm has billion shares outstanding.
The market value of its debt is $ billion.
The free cash flow is currently $ billion.
The firms equity beta is ; the equity risk premium is ; the riskfree rate is
The beforetax cost of debt is
The tax rate is
The firm has a capital structure of equity and debt.
The FCF rate of growth is
Based on the above information, calculate the following:
a WACC
b Value of the firm using the WACC as the discount rate
c Total market value of equity
d Value per share
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