1. Calculate the Net Present Value of the Free Cash Flows, using the NPV function in Excel where, Weighted Average Cost of Capital: 5%, Cash Flow in Year 1: 100, Cash Flow in Year 2: 100, Cash Flow in Year 3: 300, Cash Flow in Year 4: -200, Cash Flow in Year 5: 500, Terminal Value: 1400?
2. Calculate the fair value per share using the following information: Net Present Value of Free Cash Flows: 10000, Cash and equivalents: 3000, Debt: 6000, Number of shares: 700?
3. The equity value of the company is 10 000 000 USD. Total shares outstanding is 200 000 shares. The market value of the shares of the company now is 22 USD per share. However, the stock is declining in value now. What recommendation should be issued, given that your assumptions are true and the DCF model is done properly? a) BUY or b)SELL