Sensitivity Analysis

a) Mr. Henry would like to know how the unlevered value (baseline estimate of $205.08 million) would change if we were to vary the unlevered cost of capital (baseline rU assumed to be 13.5%) and the terminal growth rate (baseline g assumed to be 2%). Produce a two-way data table that calculates the unlevered value of Atom in which: rU ranges from 11% to 16% in 0.5% incrementsg ranges from 1.5% to 2.5% in 0.1% increments After creating the two-way table, colour the cells in a colour scale gradient such that the largest valuations are in green and smallest valuations are in red.

All-Equity
Unlevered cost of capital:	13.50%
g:	2.00%
Year:	0	1	2	3	4	5
EBIT		22.7	29.8	37.1	40.1	42.1
- Taxes @ 34%		7.7	10.1	12.6	13.6	14.3
EBI		15.0	19.7	24.5	26.5	27.8
+ Depreciation		21.5	13.5	11.5	12.1	12.7
= Operating cash flow		36.5	33.2	36.0	38.6	40.5
- Investment in NWC		-12.3	1.9	4.2	5.2	6.1
- Capital expenditures		10.7	10.1	10.4	11.5	13.1
- Change in other assets		-9.0	-6.9	-3.4	0.0	0.0
= Free cash flow		47.1	28.1	24.8	21.9	21.3
PV of FCF		41.5	21.8	17.0	13.2	11.3
Terminal value:						188.92
Unlevered value	205.08