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Full Boat Manufacturing has projected sales of $125 million next year. Costs are expected to be $74.8 million and net investment is expected to be
Full Boat Manufacturing has projected sales of $125 million next year. Costs are expected to be $74.8 million and net investment is expected to be $15.2 million. Each of these values is expected to grow at 13 percent the following year, with the growth rate declining by 2 percent per year until the growth rate reaches 5 percent, where it is expected to remain indefinitely. There are 6.7 million shares of stock outstanding and investors require a return of 13 percent return on the companys stock. The corporate tax rate is 25 percent. a. What is your estimate of the current stock price? (Do not round intermediate calculations and round your answer to 2
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