Based on the latest analyst estimates, Allied Metals Inc. will achieve sales of $225.8m against COGS of $142.3m this year. Depreciation expenses and capital expenses are scheduled to be $13.0m and $10.0m, respectively. The tax rate is projected to be 25.0 per cent.

The company pays an average of 4.30 per cent in interest per year on its $350m of outstanding debt and has a cash balance of $130m.

a) Compute the expected net income (in million). 5 marks

b) Compute the expected free cash flow (in million). 8 marks

On average, peer firms are valued at 12.2 times net income, 11.1 time EBITDA, have a price to sales ratio of 3.4, and have FCF-multiples (Free cash flow) of 13.9.

c) Calculate a valuation by multiples based on sales for the firm's market capitalization (in million)? 4 marks

d) Calculate a valuation by multiples based on net income for the firm's market capitalization (in million)? 4 marks

e) Calculate a valuation by multiples based on free cash flow for the firm's market capitalization (in million)? 4 marks