Sims Manufacturing is expected to generate $180 million in free cash flow next year, and FCF is expected to grow at a constant rate of 4% per year indefinitely. Sims has no debt or preferred stock and its required rate of return is 11%. If Sims has 50 million shares of common stock outstanding, what is the stocks value per share?
Sims Manufacturing is expected to generate $180 million in free cash flow next year, and FCF is expected to grow at a constant rate of 4% per year indefinitely. Sims has no debt or preferred stock and its required rate of return is 11%. If Sims has 50 million shares of common stock outstanding, what is the stocks value per share?
Chapter7: Common Stock: Characteristics, Valuation, And Issuance
Section: Chapter Questions
Problem 8P
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Sims Manufacturing is expected to generate $180 million in
If Sims has 50 million shares of common stock outstanding, what is the stocks value per share?
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