Question
The following table presents forecasted financial and other information for Havisham Industries: 2019 2020 2021 Projected EBIT $ 317 $ 339 $ 363 Earnings after
The following table presents forecasted financial and other information for Havisham Industries:
| 2019 | 2020 | 2021 | |
|---|---|---|---|
| Projected EBIT | $ 317 | $ 339 | $ 363 |
| Earnings after tax | 197 | 210 | 225 |
| Free cash flow | 135 | 144 | 155 |
| Havisham's WACC | 8.2% | ||
| Expected growth rate in FCFs after 2021 | 4.0% | ||
| Warranted MV firm/FCF in 2021 | 19.4 | ||
| Warranted P/E in 2021 | 18.7 |
What is an appropriate estimate of Havishams terminal value as of the end of 2021 using a warranted price-to-earnings multiple as your estimate?
Multiple Choice
$225 million
None of the options are correct.
$6,788.1 million
$3,833.0 million
$4,207.5 million
$4,365.0 million
Step by Step Solution
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Step: 1
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Corporate Governance And Financial Management Computational Optimization Modelling And Accounting Perspectives
Authors: S Nuryanah, S Islam
1st Edition
1349493228, 9781349493227
