Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

I just need the FIRM EQUITY VALUE for 2 0 1 8 . Given data and already filled in the rest: Estimating Share Value Using

I just need the FIRM EQUITY VALUE for 2018. Given data and already filled in the rest:
Estimating Share Value Using the DCF Model
Following are forecasts of Illinois Tool Works Inc. sales, net operating profit after tax (NOPAT), and net operating assets (NOA) as of December 31,2018.
Note: Complete the entire question in Excel and format each answer to two decimal places. Then enter the answers into the provided spaces below with two decimal places.
Reported Forecast Horizon Period Terminal
$ millions 20182019202020212022 Period
Sales $14,768 $15,654 $16,593 $17,589 $18,644 $19,017
NOPAT 2,7112,8803,0533,2363,4303,499
NOA 9,46210,02810,63011,26811,94412,183
Answer the following requirements with the following assumptions:
Assumptions
Terminal period growth rate 2%
Discount rate (WACC)7.35%
Common shares outstanding 328.00 million
Net nonoperating obligations (NNO) $6,204 millionAnswer the following requirements with the following assumptions:
\table[[Assumptions],[Terminal period growth rate,2%,],[Discount rate (WACC),7.35%,],[Common shares outstanding,328.00,million],[Net nonoperating obligations (NNO),$6,204,million]]
(a) Estimate the value of a share of ITW's common stock using the discounted cash flow (DCF) model as of December 31,2018.
image text in transcribed

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Fixed Income Securities Tools For Todays Markets

Authors: Bruce Tuckman, Angel Serrat

4th Edition

1119835550, 978-1119835554

More Books

Students also viewed these Finance questions

Question

Prove that a unit in a ring R cannot be a proper divisor of zero.

Answered: 1 week ago

Question

=+c) The change in your pocket by year minted. Section 22.2

Answered: 1 week ago

Question

2 To what extent does their relevance vary internationally?

Answered: 1 week ago

Question

8 What can HRM do to manage diversity?

Answered: 1 week ago

Question

7 How should HRM practitioners approach conflict in the workplace?

Answered: 1 week ago