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More on the corporate valuation model Luthor Corp. is expected to generate a free cash flow ( FCF ) of $ 1 0 , 5
More on the corporate valuation model
Luthor Corp. is expected to generate a free cash flow FCF of $ million this year $ million and the FCF is expected to
grow at a rate of over the following two years FCF and FCF After the third year, however, the FCF is expected to grow at a constant rate of
per year, which will last forever Assume the firm has no nonoperating assets. If Luthor Corp.s weighted average cost of capital WACC
is what is the current total firm value of Luthor Corp.? Note: Round all intermediate calculations to two decimal places.
$ million
$ million
$ million
$ million
Luthor Corp.s debt has a market value of $ million, and Luthor Corp. has no preferred stock. If Luthor Corp, has million shares of
common stock outstanding, what is Luthor Corp.s estimated intrinsic value per share of common stock? Note: Round all intermediate calculations to
two decimal places.
$
$
$
$
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