Question
Portage Bay Enterprises has $1 million in excess cash, no debt, and is expected to have free cash flow of $15 million next year. Its
Portage Bay Enterprises has $1 million in excess cash, no debt, and is expected to have free cash flow of $15 million next year. Its FCF is then expected to grow at a rate of 3% per year forever. If Portage Bay's equity cost of capital is 13% and it has 6 million shares outstanding, what should be the price of Portage Bay stock?
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Financial Management Of Health Care Organizations
Authors: William N. Zelman, Michael J. McCue, Alan R. Millikan, Noah D. Glick
2nd Edition
063123098X, 9780631230984
