Question

A company is projected to generate free cash flows of $150 million next year and $210 million at the end of year 2, after which it is projected grow at a steady rate in perpetuity. The company's cost of capital is 8.0%. It has $200 million worth of debt and $40 million of cash. There are 30 million shares outstanding. If the exit multiple for this company's free cash flows (EV/FCFF) is 4.0, what's your estimate of the company's stock price? Round to one decimal place.

Answer #1

**Formulae**

Formulae as above

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it is projected grow at a steady rate in perpetuity. The company's
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in cash. There are 30 million shares outstanding. Comparable
companies trade at an average EV/FCFF multiple of 9. Using the exit
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flows of $90 million per year for the next two years, after which
it is projected grow at a steady rate in perpetuity. The company's
cost of capital is 11%. It has $250 million of debt and $12 million
in cash. There are 30 million shares outstanding. Comparable
companies trade at an average EV/FCFF multiple of 9. Using the exit
multiple method for terminal value and DCF for the rest,...

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flows of $90 million per year for the next two years, after which
it is projected grow at a steady rate in perpetuity. The company's
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in cash. There are 30 million shares outstanding. Comparable
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Question 12
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flows of $85 million per year for the next two years, after which
it is projected grow at a steady rate in perpetuity. The company's
cost of capital is 11%. It has $250 million of debt and $12 million
in cash. There are 30 million shares outstanding. Comparable
companies trade at an average EV/FCFF multiple of 9. Using the exit
multiple method for terminal value and DCF for...

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