Kendra Enterprises has never paid a dividend. Free cash flow is projected to be $80,000 and...
Kendra Enterprises has never paid a dividend. Free cash flow is projected to be $80,000 and $100,000 and $106,000 for the next 3 years, respectively; after the third year, FCF is expected to grow at a constant rate of 10%. The company’s weighted average cost of capital is 15%. Calculate the value of Kendra’s operations.
Homework Answers
Value of Operations = 80,000/(1.15) + 100,000/(1.15)2 + 106,000/(1.15)3 + 106,000(1.10)/(0.15 - 0.10)(1.15)3
Value of Operation = $1,748,204.16
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Kendra Enterprises has never paid a dividend. Free cash flow is
projected to be $80,000 and...
Kendra Enterprises has never paid a dividend. Free cash flow is projected to be $80,000 and...
Kendra Enterprises has never paid a dividend. Free cash flow is projected to be $80,000 and $100,000 for the next 2 years, respectively; after the second year, FCF is expected to grow at a constant rate of 9%. The company's weighted average cost of capital is 14%. a)What is the terminal, or horizon, value of operations? (Hint: Find the value of all free cash flows beyond Year 2 discounted back to Year 2.) Round your answer to the nearest cent....
Kendra Enterprises has never paid a dividend. Free cash flow is projected to be $80,000 and...
Kendra Enterprises has never paid a dividend. Free cash flow is projected to be $80,000 and $100,000 for the next 2 years, respectively; after the second year, FCF is expected to grow at a constant rate of 9%. The company's weighted average cost of capital is 14%. a. What is the terminal, or horizon, value of operations? (Hint: Find the value of all free cash flows beyond Year 2 discounted back to Year 2.) Round your answer to the nearest...
Kendra Enterprises has never paid a dividend. Free cash flow is projected to be $80,000 and...
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Kendra Enterprises has never paid a dividend. Free cash flow is projected to be $80,000 and $100,000 for the next years
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