Question
You want to value a company using the free cash flow to equity (FCFE) method. You determined that the current FCFE in year 0 is
You want to value a company using the free cash flow to equity (FCFE) method. You determined that the current FCFE in year 0 is A$1946089 after analysing the financial statements. You expect free cash flow to grow at a substantially faster pace of 10.12 percent over the next two years, then at a constant rate of 4.87 percent after that.
You also calculated that the firm's cost of equity is 14.56 percent and its weighted average cost of capital (WACC) is 8 percent.
If there are 1,000,000 shares outstanding, what is the predicted share price of this company in two decimal places?
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Financial Reporting Financial Statement Analysis And Valuation A Strategic Perspective
Authors: James M. Wahlen, Stephen P. Baginski, Mark Bradshaw
8th Edition
1285190904, 978-1305176348, 1305176340, 978-1285190907
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