Question
Hi every one, I need help with this one please Lets try to calculate the (projected) FCF of the firm LuluYoga for 2018. Here is
Hi every one, I need help with this one please
Lets try to calculate the (projected) FCF of the firm LuluYoga for 2018.
Here is some financial information you have gathered with the help of your intern peers and supervisors at the investment bank.
The analyst team has been talking to the management of LuluYoga and they estimate that sales are going to grow by 5% from 2017 to 2018.
Financial ratios that will allow you to compute the different component of FCF are in the table. Use the historical 3-year average for all financial ratios as your estimate of the financial ratio in 2018, with two exceptions: ARDOH and APDOH. You talked to senior managers of the firm and are very confident that in 2018 AR/DOH will be 45 and AP DOH will be 20.
The corporate tax rate is 35%
2015 | 2016 | 2017 | 2018 (projected) | |
---|---|---|---|---|
Sales | 4,000,000 | 6,000,000 | 9,000,000 | |
COGS/Sales | 60.20% | 60.60% | 60.40% | |
OpExp/Sales | 23.00% | 22.80% | 22.60% | |
AR/DOH | 29 | 35 | 36 | 45 |
Inv DOH | 45 | 44 | 46 | |
NFATO | 13 | 13.5 | 13.2 | |
AP DOH | 20 | 20 | ||
Initial inventory | 196,877 |
Answer the following questions. (When you fill in the blanks, dont keep any decimal points, but rather round your answer. For example, if your computation shows 100.7, then enter 101. )
What is the NOP in 2018?
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