Question

JenBritt Incorporated had a free cash flow (FCF) of $96 million in 2019. The firm projects FCF of $290 million in 2020 and $610 million in 2021. FCF is expected to grow at a constant rate of 4% in 2022 and thereafter. The weighted average cost of capital is 10%. What is the current (i.e., beginning of 2020) value of operations? Do not round intermediate calculations. Enter your answer in millions. For example, an answer of $1 million should be entered as 1, not 1,000,000. Round your answer to two decimal places.

$ million

Answer #1

JenBritt Incorporated had a free cash flow (FCF) of $96 million
in 2019. The firm projects FCF of $250 million in 2020 and $590
million in 2021. FCF is expected to grow at a constant rate of 4%
in 2022 and thereafter. The weighted average cost of capital is 9%.
What is the current (i.e., beginning of 2020) value of operations?
Do not round intermediate calculations. Enter your answer in
millions. For example, an answer of $1 million should be...

JenBritt Incorporated had a free cash flow (FCF) of $94 million
in 2019. The firm projects FCF of $255 million in 2020 and $640
million in 2021. FCF is expected to grow at a constant rate of 5%
in 2022 and thereafter. The weighted average cost of capital is 8%.
What is the current (i.e., beginning of 2020) value of operations?
Do not round intermediate calculations. Enter your answer in
millions. For example, an answer of $1 million should be...

JenBritt Incorporated had a free cash flow (FCF) of $94 million
in 2019. The firm projects FCF of $235 million in 2020 and $470
million in 2021. FCF is expected to grow at a constant rate of 4%
in 2022 and thereafter. The weighted average cost of capital is 9%.
What is the current (i.e., beginning of 2020) value of operations?
Do not round intermediate calculations. Enter your answer in
millions. For example, an answer of $1 million should be...

eBook Horizon Value of Free Cash Flows JenBritt Incorporated had
a free cash flow (FCF) of $72 million in 2019. The firm projects
FCF of $235 million in 2020 and $650 million in 2021. FCF is
expected to grow at a constant rate of 4% in 2022 and thereafter.
The weighted average cost of capital is 10%. What is the current
(i.e., beginning of 2020) value of operations? Do not round
intermediate calculations. Enter your answer in millions. For
example,...

1.Ogier Incorporated currently has $900 million in sales, which
are projected to grow by 8% in Year 1 and by 4% in Year 2. Its
operating profitability (OP) is 7%, and its capital requirement
(CR) is 65%. Do not round intermediate calculations. Enter your
answers in millions. For example, an answer of $1 million should be
entered as 1, not 1,000,000. Round your answers to two decimal
places.
What are the projected sales in Years 1 and 2?
Sales in...

Horizon Value of Free Cash Flows
Current and projected free cash flows for Radell Global
Operations are shown below.
Actual
Projected
2019
2020
2021
2022
Free cash flow
$616.960
$677.640
$717.687
$775.100
(millions of dollars)
Growth is expected to be constant after 2021, and the weighted
average cost of capital is 10.1%. What is the horizon (continuing)
value at 2022 if growth from 2021 remains constant? Do not round
intermediate calculations. Enter your answer in millions. For
example, an answer...

Current and projected free cash flows for Radell Global
Operations are shown below. Actual 2018 2019 Projected 2020 2021
Free cash flow $619.28 $679.96 $720.01 $770.41 (millions of
dollars) Growth is expected to be constant after 2020, and the
weighted average cost of capital is 11.85%. What is the horizon
(continuing) value at 2021 if growth from 2020 remains constant? Do
not round intermediate calculations. Enter your answer in millions.
For example, an answer of $1 million should be entered...

Zen Corporation forecasts that its free cash flow in the coming
year, i.e., at t = 1, will be -$100 million, its FCF at t = 2 will
be -$40 million and its FCF at t = 3 will be $55 million. After
Year 3, FCF is expected to grow at a constant rate of 5% forever.
If the weighted average cost of capital is 12%, what is the firm’s
value of operations, in millions?

PureFood Inc forecasts that its free cash flow in the coming year,
i.e., at t=1, will be $10 million, but its FCF at t=2 will be $20
million. After Year 2 , FCF is expected to grow at a constant rate
of 5% forever. If the weighted average cost of capital is 14%, what
is the firm’s value of operations, in millions?

Zhdanov, Inc. forecasts that its free cash flow in the coming
year, i.e., at t = 1, will be -$15 million (negative), but its FCF
at t = 2 will be $30 million. After Year 2, FCF is expected to grow
at a constant rate of 3% forever. If the weighted average cost of
capital is 20%, what is the firm's value of operations, in
millions? Enter your answer rounded to two decimal places. Do not
enter $ or comma...

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