You are applying for a job as an equity analyst. The company has given you an Excel spreadsheet with some financial information about Zoom. Knowing that demand for the company's only product "exploded" with the pandemic, the company wants to know what you think the stock price should be. The company does not pay a dividend, so you are forced to use a Discounted Cash Flow Analysis to determine the value of the company. Project Instructions In this Assignment, you will use the information given in the Excel document above to determine the company's value and create a write-up explaining your thoughts. Excel File - Download the Excel file above. - Isolate Net Income, Depreciation, and Capital Expenditures (do not worry about changes in working capital) and calculate Cash Flow from these items ("hint: Capital Expenditures Deprecation is net investment). - Use a cost of capital of 10% to calculate the discounted cash flows. - Determine your estimated price per share value. - Compare your estimated price to the current price of the stock. You can look it up at any financial website such as CNBC. Remember, the ticker symbol for this Zoom is ZM. Project Hints You can find all three items (net income, depreciation, and capital expenditures) on the cash flow statement. Due to its business, appropriate capital expenditures include "Purchase of property and equipment", "Cash paid for acquisition", "Purchases of strategic investments", and "Purchases of intangible assets". "Note: in finance, defining Capex, is often subjective. fx. Prepaid expenses and other asseets B c. D Consolidated Statement of Cash Flows (in thousands, except share and per share data) 1/31/22 1/31/21 1/31/20 5 Cash flows from operating activities 6 Net Income Adjustements to reconcile net income to net 7 cash provided by operating activities 8 Stock-based compensation expense Income tax benefit from release of valuation 9 allowance Amortization of deffered contract acqusition 10 costs 11 Gains on strategic investments, net 12 Depreciation and amortization 13 Provision for accounts receivable allowances 14 Non-cash operating lease cost 15 Charitable donation of common stock 16 Amortization on marketable securities 17 Other assets, noncurrent $ 1,375,639$672,316$25,305 18 Changes in operating assets and liabilities $477,287$275,818$73,109 \$ (327,957)$ 19 - Accounts receivable Prepaid expenses and other asseets \$ 177,283$$104,306$37,101 $(43,761)$(2,538)$ $48,188$28,857$16,449 $36,747$32,007 \$ 6,370 Deferred contract acqusition costs $18,387$10,887$6,885 Accounts payable Accrued expenses and other liabilities \begin{tabular}{ll|lrl|l} $ & & $ & 23,312 & $ & \\ $ & 25,316 & $ & 5,433 & $ & (2,041) \end{tabular} Deferred revenue $ 4,591$ 927$ 973 Operating lease liabilities Net Cash provided by operating activities $ (159,183)$(219,039)$(64,715) (155,934)$(68,521)$(24,805) (247,371)$(307,068)$(72,714) s (2,218)$3,481$(2,030) \begin{tabular}{rr|rr|rr} $ & (2,218) & $ & 3,481 & $ & (2,030) \\ $ & 101,369 & $ & 251,654 & $ & 51,179 \end{tabular} $293,887$665,724$106,286 \begin{tabular}{rrrrrr} $ & (17,004) & $ & (6,379) & $ & (5,460) \\ \hline$ & 1,605,266 & $ & 1,471,177 & $ & 151,892 \end{tabular} Cash flows from investing activities Purchases of marketable securities $(4,434,749)$(2,056,470)$(800,228) Maturities of marketable securities $1,733,043$580,795$343,554 Sales of marketable securities Purchases of property and equipment $296,867$36,897$ Purchases of strategic investments (132,590)$(79,972)$(38,084) Cash paid for acquisition, net of cash acquired (305,149)$(13,000)$ (3,000) (3,501)$(26,486)$
