Answered step by step
Verified Expert Solution
Question
1 Approved Answer
TRX Corporation is expected to generate free cash flows (FCF) of $6.7 million in year 1, $9.99 million in year 2, $12.06 million in year
TRX Corporation is expected to generate free cash flows (FCF) of $6.7 million in year 1, $9.99 million in year 2, $12.06 million in year 3, and $14.81 million in year 4. After then, the FCF will grow by 3% per year. TRX has 10 million shares outstanding, $4 million in excess cash, and it has $1 million in debt. If its cost of capital is 6%, the stock price would be $________? Input your answer without the $ sign and round your answer to two decimal places.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started