You are valuing Soda City Inc It has $111 million of debt, $86 million of cash, and 161 million shares outstanding You estimate its cost of capital is 11 9 You forecast that it will generate revenues of $709 million and $791 million over the next two years Projected operating profit margin is 24 , tax rate is 28 , reinvestment rate is 29 , and terminal exit value multiple at the end of year 2 is 14 What is your estimate of its share price Round to one decimal place Hint Compute projected FCFF for years 1 and 2 based on info provided, compute terminal value using the exit multiple method, discount it all to find EV, walk the bridge to Equity, divide by number of shares outstanding

Question

You are valuing Soda City Inc  It has $111 million of debt, $86 million of cash, and 161 million shares outstanding  You estimate its cost of capital is 11 9   You forecast that it will generate revenues of $709 million and $791 million over the next two years  Projected operating profit margin is 24 , tax rate is 28 , reinvestment rate is 29 , and terminal exit value multiple at the end of year 2 is 14  What is your estimate of its share price  Round to one decimal place   Hint  Compute projected FCFF for years 1 and 2 based on info provided, compute terminal value using the exit multiple method, discount it all to find EV, walk the bridge to Equity, divide by number of shares outstanding

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You are valuing Soda City Inc. It has $111 million of debt, $86 million of cash, and 161 million shares outstanding. You estimate its cost

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