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ess Finance I 7 Question 7, P7-17 (similar to) Part 1 of 3 HW Score: 29.17%, 35 of 120 points O Points: 0 of
ess Finance I 7 Question 7, P7-17 (similar to) Part 1 of 3 HW Score: 29.17%, 35 of 120 points O Points: 0 of 10 Free cash flow valuation Nabor Industries is considering going public but is unsure of a fair offering price for the company. Before hiring an investment banker to assist in m managers at Nabor have decided to make their own estimate of the firm's common stock value. The firm's CFO has gathered dala for performing the valuation using the free cash flow The firm's weighted average cost of capital is 13%, and it has $2,100,000 of debt at market value and $420,000 of preferred stock in terms of market value. The estimated free cash fl 1 through 5, are given in the table, After year 5, the firm expects its free cash flow to grow by 3% annually. a. Estimate the value of Nabor Industries' entire company by using the free cash flow valuation model. b. Use your finding in part a, along with the data provided above, to find Nabor Industries' common stock value. c. If the firm plans to issue 200,000 shares of common stock, what is its estimated value per share? a. The value of Nabor Industries' entire company is $ (Round to the nearest dollar.)
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