Section 1: Calculate the estimated horizon value (i.e., the value of operations at the end of the forecast period immediately after the Year-4 free cash flow). Assume growth becomes constant at 5% after Year 3 for ever. Show your work.

1. Long term constant growth in FCF
2. Horizon value

Section 2: Calculate the present value of the horizon value, the present value of the free cash flows, and the estimated Year-0 value of operations. Show your work.

1. PV of horizon value
2. PV of FCF
3. Value of operations

Section 3: Calculate the estimated Year-0 price per share of common equity. Show your work.

1. Value of operations
2. Value of marketable securities
3. Total value of company
4. Value of debt
5. Value of preferred stock
6. Estimated value of common equity
7. Number of shares
8. Price per share

Data on Debt \& Equitv values for the current vear (Values Calculate the estimated horizon value (i.e., the value of operations at the end of the forecast period immediately after the Year- 4 free cash flow). Assume growth becomes constant at 5% after Year 3 for ever Calculate the present value of the horizon value, the present value of the free cash flows, and the estimated Year- 0 value of operations