Using the data provided, along with the following assumptions, estimate the value (per share) of the company?s common stock, and USE THE WORD DOCUMENT TO ANSWER THE OTHER questions that it asks for. thanks

qattachments_4e8830813a31949e5b6848e09d6d7a268df6c84e.xlsx Sales Net operating profits after taxes (NOPAT) Net operating assets (NOA) Net nonoperating obligations (NNO) Shares outstanding $92,345 Last year's sales $6,132 Last year's EBIT (1 - tax rate) $47,596 Last year's operating assets - operating liabilities ($20,805) Last year's nonoperating assets - nonoperating liabilities (usually negative) 2,500 NOPAT/Sales NOA/Sales 6.64% $6,132 $92,345 51.54% $47,596 $92,345 KRJ ($ millions) Sales Net operating profits after taxes (NOPAT) Net operating assets (NOA) Discount rate (WACC) Forecasted data (using historical averages) Historical Forecast Horizon 2015 Assumptions 2016 2017 2018 $92,345 5% $96,962 $101,810 $106,901 $6,132 6.64% $6,439 $6,761 $7,099 $47,596 51.54% $49,976 $52,475 $55,098 8% Change in NOA Free cash flows (NOPAT - Change in NOA) Present value factor Present value of forecast horizon free cash flows Cumulative present value of horizon free cash flows Present value of terminal period cash flow Total firm value Net nonoperating obligations Firm equity value Shares outstanding (millions) Value of stock per share $2,380 $4,059 0.9259 $3,758 $2,499 $4,262 0.8573 $3,654 $2,624 $4,475 0.7938 $3,552 $14,418 72,973 Discounted four years $87,390 (20,805) $66,585 Shares outstanding (millions) Value of stock per share $2,755 $4,699 0.7350 $3,454 $99,278 1% $579 $6,949 Terminal period cash flow (WACC - long-term growth rate) $6,949 (0.08 - 0.01) 2,500 $26.63 Forecasted data (using assumed averages and differing assumptions) KRJ Reported Forecast Horizon ($ millions) 2015 Assumptions 2016 2017 2018 $92,345 7% $98,809 $105,726 $113,127 Sales NOPAT $6,132 7.00% $6,917 $7,401 $7,919 Net operating assets (NOA) $47,596 50.00% $49,405 $52,863 $56,563 Discount rate 9% Change in NOA Free cash flows (NOPAT - Change in NOA) Present value factor Present value of forecast horizon free cash flows Cumulative present value of horizon free cash flows Present value of terminal period cash flow Total firm value Net nonoperating assets Firm equity value Terminal Period $113,368 $7,528 $58,432 2019 $112,246 $7,453 $57,853 $1,809 $5,108 0.9174 $4,686 $11,262 76,622 Discounted three years $87,884 (20,805) $67,079 2,500 $26.83 $3,458 $3,942 0.8417 $3,318 $3,700 $4,218 0.7722 $3,257 $99,228 Terminal Period $115,389 $8,077 $57,695 2% $1,131 $6,946 Terminal period cash flow (WACC - long-term growth rate) $6,946 (0.09 - 0.02) ($ millions) Sales Less: Cost of goods sold Gross profit Less: Selling, general, and administrative expenses Depreciation and amortization Operating profit Less: Interest expense Earnings before income taxes Income taxes Earnings after income taxes 2015 $90,478 46,924 43,554 19,980 5,821 17,753 2,678 15,075 5,111 $9,964 ($ millions) Cash & equivalents Accounts receivable, net Inventories Other current assets Total current assets Plant, property & equipment, gross Less: Accumulated depreciation Plant, property & equipment, net Long-term investments Goodwill Other noncurrent assets Total assets 2015 $1,498 8,128 15,842 8,032 33,500 73,502 39,845 33,657 3,785 4,850 12,016 $87,808 Short-term debt Current portion of long-term debt Accounts payable Other accrued expenses Total current liabilities Long-term debt Deferred taxes Other long-term liabilities Total liabilities Common stock & paid-in capital Retained earnings Treasury stock Total equity Total liabilities and equity 1,665 4,032 5,738 9,215 20,650 22,755 3,882 8,486 55,773 9,848 28,486 (6,299) 32,035 $87,808 FINC 4335 Online Summer 2016 Homework Assignment 4 1. Using the data provided, along with the following assumptions, estimate the value (per share) of the company's common stock. Sales are expected to grow at 4% per year for the next three years, and 2% per year thereafter. Net operating profit after taxes (NOPAT) is expected to remain at the same percentage of sales as it was in 2015. Net operating assets is expected to remain at the same percentage of sales as in 2015, based on year-end net operating assets. Net nonoperating obligations (NNO) is expected to remain at the same amount as in 2015. The company faces a weighted average cost of capital of 12%. There are currently 946 million shares of common stock outstanding. Based on your projection and given its current stock price of $67.89, would you be inclined to purchase or sell the company's stock? 2. You have concluded that the results from 2015 do not properly represent the correct assumptions about the future operating results for the company based on the current restructuring of operations the company is undertaking and significant changes in its competitive situation. Therefore, you have decided to make the following changes in assumptions: The growth in sales will be 3% per year for the next five years, and then 1% per year thereafter. NOPAT will be 14% of sales each year. NOA will be 60% of sales each year. NNO will be the same as above. The company's weighted average cost of capital is expected to be 16%. Based on your new projection and given its current stock price of $67.89, would you be inclined to purchase or sell the company's stock? Please include all of your calculations for each part of the assignment and submit your work in Excel via the assignment submission feature in Blackboard