Answered step by step
Verified Expert Solution
Question
1 Approved Answer
XYZ Corp just generated FCF of $50 million. Its FCF will grow by 16%, 12% and 10% respectively for years 1,2, and 3. Starting from
XYZ Corp just generated FCF of $50 million. Its FCF will grow by 16%, 12% and 10% respectively for years 1,2, and 3. Starting from year 4, the growth rate will decline to 7% per year. The WACC for XYZ Corp is 12 %. It has $100 million cash on hand, total debt of $400 million,and has 15 million shares outstanding. What is the estimated price per share for XYZ?
End of year | EOY 1 | EOY 2 | EOY 3 | EOY 4 |
growth rate | 16% | 12% | 10% | 7% |
Projectes FCF? | ? | ? | ? | ? |
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