Question
WaNaBe's shares are not traded on the stock market, but the company would like to expand its ownership base. The current owners have 50,000 shares,
WaNaBe's shares are not traded on the stock market, but the company would like to expand its ownership base. The current owners have 50,000 shares, of which they want to sell a part to the new owner. First, however, an understanding of the share price should be formed. The company has had a net debt of 5,800,000, and it has paid 5% interest on it this year. The company's operating profit is 2,730,000.
The company now intends to change its financing policy and in the future will keep the ratio of net debt to enterprise value at 30 percent. WaNaBe's weighted average cost of capital (WACC) is then estimated to be 8%.
The following estimates have also been made for next year: The company's operating profit will remain at the current level of 2730k, net investments 803k and net working capital growth 382.5k.
In the following years, the company is no longer expected to grow, so the annual operating profit estimate will not change, the net working capital will not increase, and the net investments will be zero.
- Calculate WaNaBe's Enterprise Value [k].
- Calculate the value of WaNaBe's share [xx.xx /piece].
3. After next year, a group of investors would like to buy WaNaBe shares at a price of 340.00/pc. By what percentage do they expect WaNaBe's free cash flow to grow each year?
(Enter the answer with 2 decimal places: from your calculation you get, for example, 0.04782=4.782% -> your answer is 4.78)
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