Question
Last year Brain Inc generated FCF of $1.3 M. Analysts estimate that its growth rate in the future would be stable at 3%, while it
Last year Brain Inc generated FCF of $1.3 M. Analysts estimate that its growth rate in the future would be stable at 3%, while it cost of capital will remain 10.3%. It has $5 M bonds outstanding and $7M invested in safe short-term investments (cash equivalent). If Brain Inc has 11.66 M shares outstanding, what is your estimate of its share price?
Step by Step Solution
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Step: 1
To calculate the share price of Brain Inc we can use the Free Cash Flow FCF valuation model The form...
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Financial Accounting an introduction to concepts, methods and uses
Authors: Clyde P. Stickney, Roman L. Weil, Katherine Schipper, Jennifer Francis
13th Edition
978-0538776080, 324651147, 538776080, 9780324651140, 978-0324789003
