Enterprise Value:
The enterprise value is the measurement of total value of a firm’s equity or theoretical value in order to take over its operations by paying all its debts and cash. It is calculated by subtracting total cash and cash equivalents in the summation of market value of equity and debt.
Share Price:
Share price is the highest amount an investor is willing to pay for a single share from a number of saleable stocks of a firm. It can be calculated by the formula given below:
In the given formula, is enterprise value or present value of expected free cash flows and is price of the share.
(a)
To determine:
The enterprise value of HM Corporation.
(b)
To determine:
The share price of HM Corporation.
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Fundamentals of Corporate Finance Plus MyLab Finance with Pearson eText -- Access Card Package (4th Edition) (Pearson Series in Finance)
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