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UB Production Portal 9.0 X G Estimating Share Value Using the X Inbe QZ10 (Module 13) X + X C a mybusinesscourse.com/platform/mod/quiz/attempt.php?attempt=4348812&cmid=241410&page=2 G a . .. BusinessCo Question 4 4 Incomplete answer Marked out of 8.00 Estimating Share Value Using the DCF Model Assume following are forecasts of Abercrombie & Fitch's sales, net operating profit after tax (NOPAT), and net operating assets (NOA) as of January 29, Print 1 sheet of paper abdul Saqib 2011 Reported 2011 2012 2013 2014 2015 Te Sales 3,750 $ 4,500 $ 5,400 $ 6,480 $ 7,776 $ 7,85 QZ10 (N NOPAT 464 578 825 948 Destination Microsoft Print to PDF NOA 1,333 1,612 1,944 2,289 2,780 2.806 Answer the following requirements assuming a discount rate (WACC) of 13.3%, a terminal period growth rate of 1%, common shares outstanding of 1 86.2 million, and net nonoperating obligations (NNO) of $(255) million (negative NNO reflects net nonoperating assets such as investments rather 2 3 Pages All than net obligations). (a) Estimate the value of a share of Abercrombie & Fitch common stock using the discounted cash flow (DCF) model as of January 29, 2011. (Round your answer to the nearest whole number except for the discount factors, shares outstanding, and the stock price per share. Rounding instructions: Color Color Finish attemp Round answers to the nearest whole number unless noted otherwise. . Use your rounded answers for subsequent calculations. Do not use negative signs with any of your answers. Time left 0:57:1 More settings Increase in NOA FCFF (NOPAT - Increase in NOA) Discount factor [1 / (1 + rw)' ](round 5 decimal places) Present value of horizon FCFF Cum present value of horizon FCFF Present value of terminal FCFF Support Total firm value NNO Firm equity value . . . Question 4 Incor Shares outstanding (millions) Stock price per share (round one decimal place) ecimal places) Estimating Shar (b) Assume Abercrombie & Fitch (ANF) stock closed at $77.56 on March 2, 2011. How does your valuation estimate compare with this closing price? What do you believe are some reasons for the difference? Assume followir OStock prices are a function of many factors. It is impossible to speculate on the reasons for the difference. OOur stock price estimate is lower than the ANF market price, indicating that we believe that ANF stock is overvalued. Stock prices are a function of expected NOPAT and NOA, as well as the WACC discount rate. Our lower stock price estimate pessimistic forecasts or a higher Rep discount rate (In millions) OOur stock price estimate is lower than the A market price, indicating that we believe that ANF stock is overvalued. Stock prices are a function of expected NOPAT and NOA, as well as the WACC discount rate. Our lower stock price estimate might be due to more optimistic forecasts or a lower Sales discount rate compared to other in NOPAT OOur stock price estimate is lower th et price, indicating that we believe that ANF stock is undervalued. Stock prices are a function of expected NOPAT and NOA, as well as the WACC discount rate. Our lower stock price estimate might be due to more optimistic forecasts or a lower NOA discount rate compared to other investors' and analysts' model assumptions. Please answer all parts of the question. Print Cancel Answer the following requirements assuming a discount rate (WACC) of 13.3%, a terminal period growth rate of 1%, common shares outstanding of 86.2 million, and net Type here to search O 9:28 AM 11/15/2020
