Question
Consider a company thats projected to generate revenues of $213 million next year with an operating margin of 50%. The companys tax rate is expected
Consider a company thats projected to generate revenues of $213 million next year with an operating margin of 50%. The companys tax rate is expected to be 19% and it is projected to have a reinvestment rate of 43%. After that, the company is expected to start growing its free cash flows at a stable rate of 1.9% in perpetuity (terminal phase starts after year 1). The company's cost of capital is 10%. It has $49 million of debt and $14 million in cash. There are 18 million shares outstanding. How much is each share worth based on these projections? Round to one decimal place.
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