Frank Martin Bread Company is projected to generate free cash 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 7%. 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, what is your estimate of its share price?
Please refer to below spreadsheet for calculation and answer. Cell reference also provided.
Cell reference -
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