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Use the following information to solve the questions below: Income Statement ( in millions ) of 2 0 2 3 Net Sales $ 8 0
Use the following information to solve the questions below:
Income Statement in millions of
Net Sales $
Cost of Goods sold $
Depreciation $
EBIT $
Interest Expense $
EBT $
Tax $
Net Income $
Balance sheet in millions of
LHS year year RHS year year
Current Assets Current liab.
Fixed Asset Fixed Debt
Total equity
Total Asset Total liab.equity
Additionally, note the following:
There are million shares outstanding
Free cash flow FCF and Earnings will grow at the constant rate of
Firm's equity beta is
Riskfree rate is and market return is
Total debt market value is same as the book value of debt
QUESTION # Find the Free Cash Flow FCF using equation FCF EBITt DEP NCS CHG IN NWC
We find that FCF is
r or or million dollars
QUESTION # Find the asset beta
It is approximately or or or
QUESTION # Find the discount rate k
It is approximately
Stock value per share using FCF model is therefore approximately
Question Blank of
choose your answer of per share.
QUESTION # and # Find the book value per share and the earnings per share
Book value per share is
Question Blank of
choose your answer...
and the earnings per share is
Question Blank of
choose your answer...
QUESTION # and # Find the discount rate k
For the RIM, We need to use the
Question Blank of
choose your answer... asset, equity, debt, market
beta to find the required rate of return, which is
Question Blank of
choose your answer...
ind the stock value
Stock value per share using RIM model is therefore approximately
Question Blank of
choose your answer...
per share.
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