Question
Lex Corp. is expected to generate a free cash flow (FCF) of $5,560.00 million this year (FCF = $5,560.00 million), and the FCF is expected
Lex Corp. is expected to generate a free cash flow (FCF) of $5,560.00 million this year (FCF = $5,560.00 million), and the FCF is expected to grow at a rate of 26.20% over the following two years (FCF and FCF). After the third year, however, the FCF is expected to grow at a constant rate of 4.26% per year, which will last forever (FCF). Assume the firm has no nonoperating assets. If Lex Corp.s weighted average cost of capital (WACC) is 12.78%, what is the current total firm value of Lex Corp.? (Note: Round all intermediate calculations to two decimal places.)
$124,980.22 million
$16,619.54 million
$92,159.27 million
$110,591.12 million
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