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You expect Becker Corporation to generate the following free cash flows over the next five years: Following year five, you estimate that Becker's free cash
You expect Becker Corporation to generate the following free cash flows over the next five years:
Following year five, you estimate that Becker's free cash flows will grow at 5% per year and that Becker's weighted average cost of capital is 11%. What is the enterprise value of Becker? If Becker has $300 million of debt and 24 million shares of stock outstanding, then what is the share price for Becker?
Year FCF ($ millions) 1 50 2 56 3 64 4 74 5 80Step by Step Solution
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