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You are given the information below about a company. What is the current stock price (P 0 )? Note: The FCF are expressed on a
You are given the information below about a company. What is the current stock price (P0)? | |||||
Note: The FCF are expressed on a per share basis. | |||||
FCF next year (FCF1) = | $2.00 | per share | |||
FCF in year 2 (FCF2) = | $2.50 | per share | |||
FCF in year 3 (FCF3) = | $4.00 | per share | |||
FCF Growth Rate (g) = | 3.0% | after year 3 | |||
WACC = | 8.0% | Discount rate |
|
Answers:
A) $33.76
B) $58.67
C) $72.58
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