The portfolio manager of an equity-based hedge fund is valuing the company Rodix, which in 2018 had sales and EBIT of 72000 and 4320, respectively. The portfolio manager expects sales to follow the path as given in Table 2.

Table 2: Expected Sales Year 2019 Year 2020 Year 2021 Year 2022

73150 74250 75350 75900 The portfolio manager has the additional assumptions regarding Rodix's outlook:

EBIT Margin (% sales): increases 55 basis points (0.55%) per year until 2020 and, for 2021 and 2022, it increases 25 basis points (0.25%) per year.

Depreciations: 5% of sales, every year.

Recurrent Capital Expenditure (Capex): 7.5% of sales for 2019 with percentage decreasing 80 basis points (0.80%) per year until 2021.

Change in Working Capital: 14% of annual change of sales.

Tax rate: 25%.