Basic Stock Valuation: Free Cash Flow Valuation Model known as the free cash flow valuation model. The market value of a firm is equal to the present value of its expected future free cash flows: at a constant rate, the equation to calculate the continuing value of the firm at that date is: Horizonvalue=VCompanyattN=FCFN+1/(WACCGgPCF) market value of equity. The market value of equity is divided by the number of common shares outstanding to estimate the firm's intrinsic per-share value. period of nonconstant growth. (December 31, 2017)? Do not round intermediate calculations. Round your answer to the nearest cent. per share Quantitative Problem 2: Hadley Inc. forecasts the year-end free cash flows (in millions) shown below. are 19 million shares outstanding. What is the value of the stock price today (Year 0 )? Do not round intermediate calculations. Round your answer to the nearest cent. $ per share According to the valuation models developed in this chapter, the value that an investor assigns to a share of stock is dependent on the length of time the investor plans to hold the stock. The statement above is Conclusions dividends. In principle, we should find the same intrinsic value using either model, but differences are often observed