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Estimate the firms price per share using the discounted cash flow model. You are trying to estimate the value of Doc McRuffins Incorporated. It is
Estimate the firms price per share using the discounted cash flow model.
You are trying to estimate the value of Doc McRuffins Incorporated. It is a rival firm to Ellie's Essentials, but not publicly traded. You do know that Doc McRuffins has an EBITDA of $4,750 for 2018. Using multiples, what is a rough estimate for the enterprise value of Doc McRuffins
Consider recent financials for Ellie's Essentials LLC: Balance Sheet 2017 $11,366.00 $10,000.00 $31,000.00 $30,000.00 $42,366.00 $40,000.00 $8,839.00 $8,000.00 $13,163.00 $12,000.00 $22,002.00 $20,000.00 Shareholder Equity $20,364.00 $20,000.00 Liabilities and Equity $42,366.00 $40,000.00 2018 Current Assets Net PPE Total Assets Current Liabilities Long-term debt Total Liabilities Income Statement SALES COGS GROSS PROFIT S&A Depreciation EBIT INTEREST EBT TAXES (39.00%) NET INCOME 2017 $11,000.00 $10,000.00 $4,400.00 $4,000.00 $6,600.00 $6,000.00 $1,100.00 $1,000.00 $550.00 $500.00 $4,950.00 $4,500.00 $1,272.00 $1,200.00 $3,678.00 $%3,300.00 $1,434.42 $1,287.00 $2,243.58 $2,013.00 2018 Going forward, analysts have forecasted the following free cash flows: $2,800.00 in 2019, and $2,600.00 in 2020. After that point, analysts expect free cash flows to grow at 3.00% The firm has no short-term debt or preferred stock, and there are 1,000 shares outstanding. The firm's cost of capital is 10.00% Find the free cash flow for the firm in 2018 Consider recent financials for Ellie's Essentials LLC: Balance Sheet 2017 $11,366.00 $10,000.00 $31,000.00 $30,000.00 $42,366.00 $40,000.00 $8,839.00 $8,000.00 $13,163.00 $12,000.00 $22,002.00 $20,000.00 Shareholder Equity $20,364.00 $20,000.00 Liabilities and Equity $42,366.00 $40,000.00 2018 Current Assets Net PPE Total Assets Current Liabilities Long-term debt Total Liabilities Income Statement SALES COGS GROSS PROFIT S&A Depreciation EBIT INTEREST EBT TAXES (39.00%) NET INCOME 2017 $11,000.00 $10,000.00 $4,400.00 $4,000.00 $6,600.00 $6,000.00 $1,100.00 $1,000.00 $550.00 $500.00 $4,950.00 $4,500.00 $1,272.00 $1,200.00 $3,678.00 $%3,300.00 $1,434.42 $1,287.00 $2,243.58 $2,013.00 2018 Going forward, analysts have forecasted the following free cash flows: $2,800.00 in 2019, and $2,600.00 in 2020. After that point, analysts expect free cash flows to grow at 3.00% The firm has no short-term debt or preferred stock, and there are 1,000 shares outstanding. The firm's cost of capital is 10.00% Find the free cash flow for the firm in 2018Step by Step Solution
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