Question
Portage Bay Enterprises has $3 million in excess cash, no debt, and is expected to have free cash flow of $11 million next year. Its
Portage Bay Enterprises has $3 million in excess cash, no debt, and is expected to have free cash flow of $11 million next year. Its FCF is then expected to grow at a rate of 5% per year forever. If Portage Bay's equity cost of capital is10% and it has 77 million shares outstanding, what should be the price of Portage Bay stock?
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Analysis For Financial Management
Authors: Robert Higgins
6th Edition
0071181172, 9780071181174
