WACC (r) 14% Long-term growth (g) 4% Excess Cash $0 Debt (Mkt Val) $300,000,000 Shares Outstanding 40,000,000 Time = 0 1 2 3 4 5 6 $53.00 $68.00 $78.00 $75.00 $82.00 FCF ($ mill) Terminal Value CFs to Discount cfs *discount Enterprise Value + Cash - Debt = Equity Value /Shares Outstanding = Share Price Heavy Metal Corporation is expected to generate the following free cash flows over the next five years 12345 FCF ($ mill) $53 $68 $78 $75 $82 After five years, the free cash flows are expected to grow at the industry average of 4% per year. Using the discounted free cash flow model and a weighted average cost of capital of 14% a. Estimate the enterprise value of Heavy Metal b. If Heavy Metal has no excess cash, market value of debt of $300 million, and 40 million shares outstanding, estimate its share price.