You are considering an investment into Company XYZ and need to determine the company's value and the appropriate investment amount. You have been provided with historical financial statements for the past three years in order to build a forecast model. Key assumptions to use include:

Future sales revenue is assumed to increase at 2.5% annually.

Gross margin for 2021E is assumed to be equal to the average gross margin % for 2019 and 2020, but will decrease by 2.5% (i.e. 250 bps) each year thereafter

SG&A expense is assumed to be a percentage of revenue for the forecast period. That percentage is equal to the 2018-2020 average

Depreciation expense is assumed to be a percentage of revenue for the forecast period. That percentage is equal to the 2018-2020 average

The tax rate for the forecast period is assumed to be equal to the effective tax rate for 2018

Capital expenditures for any given year in the forecast period is assumed to be 3x the prior year's depreciation expense. For example, 2021 capital expenditures is equal to 3x 2020 depreciation expense.

No new debt or equity is assumed to be issued

3

What is Cash Generated From Operating Activities in 2025E using the assumptions listed above and on the Control Panel?

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$12,640

$12,074

$13,523

$12,379