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a. You forecast that future free cash flows after year 5 will grow at 3% per year, forever. Estimate the continuation value in year 5
a. You forecast that future free cash flows after year 5 will grow at 3% per year, forever. Estimate the continuation value in year 5 , using the perpetuity with growth formula. average P/E ratio for the comparable firms today. c. The average market/book ratio for the comparable firms is 4.7 . Estimate the continuation value using the market/book ratio. Note. Aseume that all firme (innludina voura) have nn deht a. You forecast that future free cash flows after year 5 will grow at 3% per year, forever. Estimate the continuation value in year 5 , using the perpetuity with growth formula. The continuation value in year 5 is $ million. (Round to one decimal place.) average P/E ratio for the comparable firms today. The continuation value in year 5 is $ million. (Round to one decimal place.) c. The average market/book ratio for the comparable firms is 4.7 . Estimate the continuation value using the market/book ratio. The continuation value in year 5 is $ million. (Round to one decimal place.)
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