Question
Hi, please help! I have no idea how to answer this problem. Free Cash Flows Year 1= $21 million Year 2= $26 million Year 3=$30
Hi, please help! I have no idea how to answer this problem.
Free Cash Flows
Year 1= $21 million
Year 2= $26 million
Year 3=$30 million
Year 4=$31 million
Year 5=$33 million
XYZ Industries is expected to generate the above free cash flows over the next five years, after which free cash flows are expected to grow at a rate of 4% per year. If the weighted average cost of capital is 7% and XYZ has cash of $15 million, debt of $48 million, and 71 million shares outstanding, what is General Industries' expected current share price?
Answer in millions and round to the nearest cent.
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