Steve Company is a small manufacturer of Specialized phones. Mr. Steve may want to sell his company, and the stock is trading publicly with a most recent closing price of $40 per share. There are 2 million common shares outstanding. No preferred shares. Mr. Steve may want to sell his company. What minimum price should he realistically request from a buyer? Use a straight DCF analysis (given information is the estimation from Mr. Steve ).

Steve Company is a small manufacturer of Specialized phones. Mr. Steve may want to sell his company, and the stock is trading publicly with a most recent closing price of $40 per share. There are 2 million common shares outstanding. No preferred shares. Mr. Steve may want to sell his company. What minimum price should he realistically request from a buyer? Use a straight DCF analysis (given information is the estimation from Mr. Steve ). All amounts in thousands 2021e $1,900 2022e $2,010 2023e $2,700 2024e $2,500 2025e $3,200 2026e $3,300 Conservative estimate of free cash flow Terminal Value Total free cash flow Relevant Information: Terminal Growth rate Credit rating of Steve Company's debt Beta 20 year US Treasury Bond Yield Equity Market risk premium Tax Rate Book value of shareholders Equity = Total debt on Books 6% Baa (yielding 9% = Steve's pretax cost of debt) 1.3 5.20% 6.00% 35% $30,000 $20,000