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Sora Industrios has 69 milition outstanding shares. 5123 milion in debt, $56 mittion in cash, and the following projected free cash flow for the next

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Sora Industrios has 69 milition outstanding shares. 5123 milion in debt, $56 mittion in cash, and the following projected free cash flow for the next four yoars: a. Suppose Sora's revenue and free cash fow are expected to grow at a 4.6% rate beyond year four, If Sora's weighted average cost of capial is 10.0. Wh, what is the value of Sora shock bated on this information? b. Sora's cost of goods sold was assumed to be 67 th of salos. If its cost of goods sold is actualy 70% of sales, how would the estimate of the stock's value change? c. Return to the assumptions of part (a) and suppose Sora can maintain its cost of goods sold at 67 th of sales. However, the frm reduces its soling, general, and adiministative expenses trim 20% of sales to 16% of sales. What stock price would you estimate now? (Assume no other expenses, except taxes, are affected) d. Sora's net working capital needs were estimated to be 18% of sales (their current level in year zero). If Sora can reduce this recuirement to 12% of sales starting in year 1 , but at ofter assumptions are as in (a), what stock price do you estimate for Sora? (Hint. This change was have the largest impact on Sord's free cash flow in year 1 .) a. Suppose Sora's revenue and free cash flow are expected to grow at a 4,6% rate beyond year four. It Sora's weighted average cost of capital is 10 . Oh. what is the valus of Sora atock based on this information? The stock price for this case is 5 (Round to the nearest cent.) cost of goods sold was assumed to be 67% of sales. If its cost of goods sold is actually 70% of sales, how would the ostimate of the stockin value change? to the assumptions of part (a) and suppose Sora can maintain its cost of goods sold at b7t of salos. Howewer. the Erm reduces its solling. general, and athrinistrative expenses from 20m. Data table a. 12% of sales staring in year 1, but all oher V in year 1.) tal is 10.0%, what is the value of Sora stock based on this Sora Industrios has 69 milition outstanding shares. 5123 milion in debt, $56 mittion in cash, and the following projected free cash flow for the next four yoars: a. Suppose Sora's revenue and free cash fow are expected to grow at a 4.6% rate beyond year four, If Sora's weighted average cost of capial is 10.0. Wh, what is the value of Sora shock bated on this information? b. Sora's cost of goods sold was assumed to be 67 th of salos. If its cost of goods sold is actualy 70% of sales, how would the estimate of the stock's value change? c. Return to the assumptions of part (a) and suppose Sora can maintain its cost of goods sold at 67 th of sales. However, the frm reduces its soling, general, and adiministative expenses trim 20% of sales to 16% of sales. What stock price would you estimate now? (Assume no other expenses, except taxes, are affected) d. Sora's net working capital needs were estimated to be 18% of sales (their current level in year zero). If Sora can reduce this recuirement to 12% of sales starting in year 1 , but at ofter assumptions are as in (a), what stock price do you estimate for Sora? (Hint. This change was have the largest impact on Sord's free cash flow in year 1 .) a. Suppose Sora's revenue and free cash flow are expected to grow at a 4,6% rate beyond year four. It Sora's weighted average cost of capital is 10 . Oh. what is the valus of Sora atock based on this information? The stock price for this case is 5 (Round to the nearest cent.) cost of goods sold was assumed to be 67% of sales. If its cost of goods sold is actually 70% of sales, how would the ostimate of the stockin value change? to the assumptions of part (a) and suppose Sora can maintain its cost of goods sold at b7t of salos. Howewer. the Erm reduces its solling. general, and athrinistrative expenses from 20m. Data table a. 12% of sales staring in year 1, but all oher V in year 1.) tal is 10.0%, what is the value of Sora stock based on this

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