Consider the following data for Nike Inc.: In 2009 it had $ 19 comma 250$19,250million in sales with a 10% growth rate in 2010, but then slows by 1 %1%

to the long-run growth rate of 55% by 2015. Nike expects EBIT to be 10% of sales, increases in net working capital requirements to be 10% of any increases in sales, and capital expenditures to equal depreciation expenses. Nike also has $2 comma 3002,300 million in cash, $3232 million in debt, 486486 million shares outstanding, a tax rate of 2424%,and a weighted average cost of capital of1010%.

a. Suppose you believe Nike's initial revenue growth rate will be between 7 % and 11% (with growth slowing linearly to 55% by year 2015). What range of prices for Nike stock is consistent with these forecasts?

b. Suppose you believe Nike's initial revenue EBIT margin will be between 9% and 11% of sales. What range of prices for Nike stock is consistent with these forecasts?c. Suppose you believe Nike's weighted average cost of capital is between 9.5% and 12%.What range of prices for Nike stock is consistent with these forecasts?

d. What range of stock prices is consistent if you vary the estimates as in parts(a),(b),and(c) simultaneously?

a. Suppose you believe Nike's initial revenue growth rate will be between 7% and11% (with growth slowing linearly to 55% by year 2015). What range of prices for Nike stock is consistent with these forecasts?

The range of prices will be:Highest price share:

(Round to the nearest cent.)

Lowest price share:

b. Suppose you believe Nike's initial revenue EBIT margin will be between 9 %

and11% of sales. What range of prices for Nike stock is consistent with these forecasts?

The range of prices will be:

Highest price per share:

$nothing.

(Round to the nearest cent.)Lowest price per share:

$nothing

(Round to the nearest cent.)c. Suppose you believe Nike's weighted average cost of capital is between

9.59.5%

and

1212%.

What range of prices for Nike stock is consistent with these forecasts?

The range of prices will be:

Highest price per share:

$nothing.

(Round to the nearest cent.)Lowest price per share:

$nothing

(Round to the nearest cent.)d.Compute the stock prices when the initial revenue growth begins at

7 %7%,

the EBIT is

9 %9%

of sales, and the WACC is

1212%.

Then compute the stock price when the initial revenue growth begins at

11 %11%,

the EBIT is

11 %11%

of sales, and the company's WACC is

9.59.5%.

What is the range of prices under these scenarios?

The range of prices will be:

Highest price per share:

$nothing

(Round to the nearest cent.)Lowest price per share:

$nothing

(Round to the nearest cent.)