Question
You are valuing a company at year end 2020 that has a target capital structure of 55% equity and 45% debt, That estimated cost of
You are valuing a company at year end 2020 that has a target capital structure of 55% equity and 45% debt, That estimated cost of equity 12% and cost of debt(excluding tax effect) is 4%, respectively. The estimated stream of free cash flow to the firm is:
| Value is | 2020 | 2021 | 2021 | 2023 | 2024 |
| FCF | 2000 | 2400 | 2550 | 2870 | 3000 |
The expected nominal growth rate of FCF in perpetuity is 2%. The corporate tax rate is 30%. The estimated enterprise value is :
- 47503
- 44691
44041
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Finance For Development
Authors: Barbara Stallings
1st Edition
0815780850, 978-0815780854
