Question
The Justice League has an expectation that it will produce $50 million in free cash flow next year, and their FCF is expected to grow
The Justice League has an expectation that it will produce $50 million in free cash flow next year, and their FCF is expected to grow at a constant rate of 3% per year indefinitely. The Justice League has no preferred stock or debt, and its WACC is 8%.
If The Justice League has 20 million shares of stock outstanding, what is the stock's value per share?
(Hint: you first need to calculate the value of the firm and then use that amount to get your "Equity value per share")
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Fundamentals Of Financial Management
Authors: James Van Horne, John Wachowicz
13th Revised Edition
978-0273713630, 273713639
