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Forta Manufacturing just reported Free Cash Flow (FCF) of $60 million, which is expected to grow at 4% indefinitely. The company has 20,000,000 shares of
- Forta Manufacturing just reported Free Cash Flow (FCF) of $60 million, which is expected to grow at 4% indefinitely. The company has 20,000,000 shares of common stock outstanding, $275 million in debt, and $35 million in preferred stock outstanding. Forta has a WACC of 12% and excess cash of $25 million.
- (4 Points) What is the value of Forta's operations?
- (4 Points) What is the intrinsic value (per share) of Forta's common stock?
- (4 Points) Suppose Forta uses its excess cash to repurchase shares. How many shares will be repurchased?
- (4 Points) What is the intrinsic value (per share) of Forta's common stock after the share repurchase?
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Accounting For Decision Making And Control
Authors: Jerold Zimmerman
10th Edition
1259969495, 978-1259969492
