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Please use excel formulas Heavy Metal Corporation is expected to generate the following free cash flows over the next ive years. Year 2 $68 4
Please use excel formulas
Heavy Metal Corporation is expected to generate the following free cash flows over the next ive years. Year 2 $68 4 $75 FCF (million) $53 $78 $82 After then, the free cash flows are expected to grow at the industry average of 4% per year. Using the discounted free cash flow model and a weighted average cost of capital of 14%; a. Estimate the enterprise value of Heavy Metal. b. If Heavy Metal has no excess cash, debt of $300 milion, and 40 million shares outstanding, estimate its share price Cost of capital Long-run growth rate 14.00% 4.00% Year 4 S75.00 FCF (million) S53.00 S68.00 S78.00 S82.00 Terminal value (milion) Total cash flow (million) S852.80 S53.00 S68.00 S78.00 a. Estimate the enterprise value of Heavy Metal. Enterprise value (million)
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