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All of the answers with details pleaseee Sora Industries has 60 million outstanding shares. $124 million in debt $55 million in cash and the following
All of the answers with details pleaseee
Sora Industries has 60 million outstanding shares. $124 million in debt $55 million in cash and the following projected free cash flow for the next four years Year 0 1 Earnings and FCF Forecast (5 million) 1 Sales 433.0 4680 5160 547.0 5743 2 Growth vs. Prior Year 8.1% 10.3% 60% 50% Cost of Goods Sold (313.6) (345.7) (3665) (384.8) 4 Gross Profit 154.4 1703 180.5 189.5 5 Soling, General, & Admin 193.6) (1032) (109.4) (1149) 6 Deprecation (70) (7-5) 19.09 195) 7 EBIT 53 a 596 621 652 Les Income Tax at 25% (13.5) (149) (155) (163) 9 Plus Depreciation 70 7.5 9.0 9.5 10 Les Capital Expenditures (7.7) (100) (9.9) (104) 11 Les increase in NWC (63) (6.0) (4.0) 12 Free Cash Flow 3114 336 40.1 43:1 a. Suppose Sora's revenue and free cash flow are expected to grow at 48%rale beyond year four. If sor's weighted average cost of capitalis 0.0%, what is the value of Sora stock based on this information hor's cost of goods sold was assumed to be 67% of salen. If its cost of goods sold is actually 70% of sales, how would the estimato of the stock's value change? Relum to the assumptions of part(a) and suppose Sora can mantan its cost of goods sold at 67% of However, the firm reduces its sein, general, and administrative expenses from 20% of sales to 10% of sales. What stock price would you estimate now? (Assume no other expenses, except taxes are affected) d. Sora's not working capital needs were estimated to be 18% of sales their current level in year 2000) Sora carduce this requirement to 12% of starting in year 1, but all other assumption sin() what stock price do you estimate for Sora? Mint This change will have the largest impact on Sora's free cash flow in year 1.) Step by Step Solution
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