Roy Harper forecasts the free cash flows (in millions) for a company shown below. The weighted average
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Question:
Roy Harper forecasts the free cash flows (in millions) for a company shown below. The weighted average cost of capital is 13%, and the FCFs are expected to continue growing at a 5% rate after Year 3. Assuming that the ROIC is expected to remain constant in Year 3 and beyond, what is the Year 0 value of operations, in millions?
Year:123
Free cash flow: -$30$20$80
A.
$772.26
B.
$775.09
C.
$768.94
D.
$770.55
Posted Date: