Suppose you are valuing a company that is growing its free cash flows at a stable 2.4% annual rate in perpetuity. It is projected to generate free cash flows of $162 million next year and its cost of capital is 9.8%. Debt is $426 million, cash balance is $88 million, and shares outstanding is 126 million. What is your estimate for the value of each share? Round to one decimal place.

Suppose you are valuing a company that is growing its free cash flows at a stable 2.4% annual rate in perpetuity. It is projected to generate free cash flows of $162 million next year and its cost of capital is 9.8%. Debt is $426 million, cash balance is $88 million, and shares outstanding is 126 million. What is your estimate for the value of each share? Round to one decimal place.

Financial Management: Theory & Practice

16th Edition

ISBN:9781337909730

Author:Brigham

Publisher:Brigham

Chapter7: Corporate Valuation And Stock Valuation

Section: Chapter Questions

Problem 11P: Brook Corporation’s free cash flow for the current year (FCF0) was $3.00 million. Its investors...

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