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6 12 points ABC, Inc. is expected to have the following free cash flows (FCF): Year 1 2 3 4 FCF (million) 13 15 16

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6 12 points ABC, Inc. is expected to have the following free cash flows (FCF): Year 1 2 3 4 FCF (million) 13 15 16 17 Grow by 3% per year a If ABC's beta is 0.8, the market return is 14% and the risk free rate is 4%, what should be ABC's expected return b. IfABC has 66 million shares outstanding. 33 million in excess cash and it has 5 million in debt, what should be its stock price today (ie, Po? (Note: use ther calculated c ABC has no plans to add more debt change the number of shares outstanding or change its cash boldings (it does not invest its cash holdings). If you plan to sell ABC in years lie. just after FCF3 is realized), what is its expected price in three years (ie, P3) d. ABC has no plans to add more debt, change the number of shares outstanding, or change its cash holdings (it does not investits cash holdings). If you plan to sell ABC in years tie, just after FCF3 is realized), how much are you willing to pay for a share of this company TODAY (I.e, Po)? Dragn Drop here or Browse 6 12 points ABC, Inc. is expected to have the following free cash flows (FCF): Year 1 2 3 4 FCF (million) 13 15 16 17 Grow by 3% per year a If ABC's beta is 0.8, the market return is 14% and the risk free rate is 4%, what should be ABC's expected return b. IfABC has 66 million shares outstanding. 33 million in excess cash and it has 5 million in debt, what should be its stock price today (ie, Po? (Note: use ther calculated c ABC has no plans to add more debt change the number of shares outstanding or change its cash boldings (it does not invest its cash holdings). If you plan to sell ABC in years lie. just after FCF3 is realized), what is its expected price in three years (ie, P3) d. ABC has no plans to add more debt, change the number of shares outstanding, or change its cash holdings (it does not investits cash holdings). If you plan to sell ABC in years tie, just after FCF3 is realized), how much are you willing to pay for a share of this company TODAY (I.e, Po)? Dragn Drop here or Browse

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