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A) What is the present value of a perpetuity that is expected to pay $6 per year forever at a discount rate of 8%? B)

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A) What is the present value of a perpetuity that is expected to pay $6 per year forever at a discount rate of 8%? B) What if the perpetuity paid $6 for the first 2 years, but was expected to grow at a constant rate of 3% after year 2. What is the PV of the perpetuity at a discount rate of 8% c) What if the perpetuity paid $6 for the first 4 years, but was expected to grow at a constant rate of 3.5% after year 4. What is the PV of the perpetuity at a discount rate of 8% 2) What is the intrinsic value of a stock that is expected to provide EPS of $2 next year and $2.50 in year 2 and have a horizon value of $50 in 2 years if the discount rate is 6.5% and the dividend payout is 30%. If the market price of the stock is $35, would you want to buy it? 3) What is the horizon value in 5 years of a stock that is expected to have EPS of $4, $4.50, $5, $6 and $6.50 over the next 5 years and sell at a ttm P/E multiple of 19 at the end of 5 years? a. What is the intrinsic value if the discount rate is 9% and the dividend payout ratio is 40%? 4) What is the horizon value of the assets in 3 years of a company that is expected to generate FCF of $40 mill next year, $50 million in year 2 and $55 million in year 3. After year 3 the FCF is expected to grow at 4%. The WACC is 7.5%. a. What is the per share intrinsic value if the Company has 300 million in debt and 60 million shares outstanding

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