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The following table shows projected free cash flows for the next three years for Care4UMed Corp., a company producing portable oxygen machines. Free Cash Flow
The following table shows projected free cash flows for the next three years for Care4UMed Corp., a company producing portable oxygen machines. Free Cash Flow (Millions of dollars) Year 1 3.10 2 3.41 3 3.75 After the three year period, Care4UMed is expected to grow at a constant rate of 10% and its WACC is 15%. Care4UMed has $25 million of debt and $180 million shares of stock outstanding. According to the video, what is the formula for Care4UMed's horizon value? FCF HV3 = WACC-8 FCF4 HV3 = 1+WACC HV3 = FCF5 x (1 + 8)3 HV4 = FCFS X (1 + 8) Care4UMed's horizon value is million. Care4U Med's horizon value is million. According to the video, what is the formula for the firm's value today? VO HV3 VO = + (1+WACC)4 HV3 (1+WACC)4 FCF (1+WACC) FCF (1+WACC) FCF (1+WACC) Vo FCF2 + + (1+WACC) FCF2 + + (1+WACC) FCF2 + (1+WACC) FCF3 (1+WACC)3 FCF3 (1+WACC)3 FCF3 (1+WACC) + HV3 VO + + HV3 (1+WACC) Care4U Med's value today is million. According to the video, the value of equity is found as Care4U Med's equity is million. According to the video, the price per share is found as Care4UMed's the price per share is
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