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Suppose you have been given the following historical data and forecasts at the beginning of 2021: 2021E 2022E 2023E 2020A 30 NOA ReOI 6.60 14.52
Suppose you have been given the following historical data and forecasts at the beginning of 2021: 2021E 2022E 2023E 2020A 30 NOA ReOI 6.60 14.52 26.62 The company's weighted-average cost of capital (WACC) is 10%. The company has NFO of 10 at the beginning of 2021. Suppose you assume the company will be in steady state in 2023 and that a terminal growth rate of 5% after 2023 is appropriate. Required What is the total value of the firm (i.e. value of NOA) using the residual operating income model at the beginning of 2021? Answer to one decimal place (2 marks) Comparable companies have a mean P/B ratio of 5.0. What is the value of the company using a comparable companies valuation approach? Round your answer to the nearest whole number (2 marks) What is forecasted total Operating Income (after-tax) for 2021? Answer to one decimal place (2 marks)
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