Question

You must estimate the intrinsic value of IST Technologies’ stock. The end-of-year free cash flow (FCF1)...

You must estimate the intrinsic value of IST Technologies’ stock. The end-of-year free cash flow (FCF1) is expected to be $55.00 million, and it is expected to grow at a constant rate of 5.0% a year thereafter. The company’s WACC is 9.0%, it has $105.0 million of long-term debt plus preferred stock outstanding, and there are 20.0 million shares of common stock outstanding. What is the firm's estimated intrinsic value per share of common stock?

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Answer #1

So, the firm's estimated intrinsic value per share of common stock = $ 63.50 per share

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