Assuming a company has the below unlevered free cash flow, what is the present value of...
Assuming a company has the below unlevered free cash flow, what is the present value of the terminal value assuming 15.0% discount rate and a 3.0% perpetuity rate? Cash flow for years 1-5 are - $125, $150, $165, $180 and $200.
Homework Answers
Please provide rating..
| terminal value = 6th year cash flow/(required rate - perpetuity rate) | |||
| 6th year cash flow = 5th year cash flow *(1+perpetuity rate) | |||
| 6th year cash flow = | =200*103% | ||
| 6th year cash flow = | 206 | ||
| Therefore terminal value = | =206/(15%-3%) | ||
| Therefore terminal value = | 1,716.67 | ||
| present value of terminal value = | =1716.67/(1.15)^5 | ||
| present value of terminal value = | 853.49 | ||
Add Answer to:
Assuming a company has the below unlevered free cash flow, what
is the present value of...
A company has unlevered cash flow in years 1-5: $10, $12.5, $13.5, $14.0, $15.0. What is...
A company has unlevered cash flow in years 1-5: $10, $12.5, $13.5, $14.0, $15.0. What is the value of the 5 year projection period assuming a 14.0% discount rate and a 2% perpetuity rate?
A company has unlevered cash flow in years 1-5: $10, $12.5, $13.5, $14.0, $15.0. What is...
A company has unlevered cash flow in years 1-5: $10, $12.5, $13.5, $14.0, $15.0. What is the value of the 5 year projection period assuming a 14.0% discount rate and a 2% perpetuity rate? a) $44 b)$57 c)$9 d)$128
Where is the error? Assumptions WACC Perpetuity growth rate 7.00% 3.00% 20x0A Unlevered Free Cash Flows...
Where is the error? Assumptions WACC Perpetuity growth rate 7.00% 3.00% 20x0A Unlevered Free Cash Flows $325.0 NPV of Unlevered Free Cash Flow Terminal Value PV of Terminal Value Projections 20x1E 20x2 20x3E $335.0 $348.0 $362.0 $912.5 $9,321.5 $7,609.1 Enterprise Value Debt Cash Equity Value Diluted shares outstanding Implied value per share $8,541.9 541.9 261.0 $8,261.0 826.000 $10.00 O A. NPV of Unlevered Free Cash Flow OB. Terminal Value C. PV of Terminal Value O D. Enterprise Value E. Equity...
Talcon Corporation has a 11% unlevered cost of equity. The company forecasts the free cash flows...
Talcon Corporation has a 11% unlevered cost of equity. The company forecasts the free cash flows shown below. The cash flows are expected to grow at a constant rate of 4% rate after Year 3. Unlevered cost of equity 11% Growth rate after Year 3 4% Year 1. Year 2 Year 3 Free Cash Flow 450 750 805 a. Calculate the expected free cash flow for Year 4. What might cause the free cash flow to be lower? b. Calculate...
A) What is the present value of this cash flow at 8% discount rate? B) What...
A) What is the present value of this cash flow at 8% discount
rate?
B) What is the present value of this cash flow at 14% discount
rate?
C) What is the present value of this cash flow at 27% discount
rate?
Different cash flow. Given the following cash inflow, what is the present value of this cash flow at 8%, 14%, and 27% discount rates? Year 1 Year 2: Years 3 through 7: Year 8: $1,000 $5,000 $0 $25,000
Different cash flow. Given the following cash inflow, what is the present value of this cash...
Different cash flow. Given the following cash inflow, what is the present value of this cash flow at 3%, 13%, and 24% discount rates? Year 1 Year 2: Years 3 through 7: Year 8: $1,000 $6,000 SO $26,000 What is the present value of this cash flow at 3% discount rate? SL (Round to the nearest cent.) What is the present value of this cash flow at 13% discount rate? SL (Round to the nearest cent.) What is the present...
What is the Net Present Value (NPV) for the below series of project cash flows, assuming...
What is the Net Present Value (NPV) for the below series of project cash flows, assuming a discount rate of 7%? Year Cash Flow CY ($450,000) CY+1 $79,000 CY+2 $125,000 CY+3 $140,000 CY+4 $135,000 CY+5 $45,000 a. $102,991 b. ($17,631) c. $22,991 d.($16,478)
Konerko Corporation has a forecasted free cash flow to the firm (FCFF) of $13,800 per year...
Konerko Corporation has a forecasted free cash flow to the firm (FCFF) of $13,800 per year in the terminal period, which begins in year 5. What is the present value of the terminal period FCFF assuming a weighted average cost of capital (WACC) of 7% and terminal growth rate of 2%?
Net Present Value/Cash Flow Estimation word problem. Information is given below. (view pictures) FINA 440 Net...
Net Present Value/Cash Flow Estimation word problem.
Information is given below.
(view pictures)
FINA 440 Net Present Value Panda Snow Suits Panda Children's Clothing Company is considering expanding its product lines into snow suits. It has spare capacity on its sewing machinery, but would need to buy a new cutting machine for $40000. It expects to increase labor costs by S4000 in the first year, materials by $6,000 in the first year, and overheads by $2000. Sales for the new...
A company is projected to generate a free cash flow of $100 million next year (year...
A company is projected to generate a free cash flow of $100 million next year (year 1) and $120 million in two years (year 2). After that it is projected grow at a steady rate in perpetuity. The company's cost of capital is 10%. It has $400 million of debt and $40 million in cash. There are 60 million shares outstanding. Comparable companies trade at an average EV/FCFF multiple of 6.9. Using the exit multiple method for terminal value and...
Where is the error? Assumptions WACC Perpetuity growth rate 7.00% 3.00% 20x0A Unlevered Free Cash Flows $325.0 NPV of Unlevered Free Cash Flow Terminal Value PV of Terminal Value Projections 20x1E 20x2 20x3E $335.0 $348.0 $362.0 $912.5 $9,321.5 $7,609.1 Enterprise Value Debt Cash Equity Value Diluted shares outstanding Implied value per share $8,541.9 541.9 261.0 $8,261.0 826.000 $10.00 O A. NPV of Unlevered Free Cash Flow OB. Terminal Value C. PV of Terminal Value O D. Enterprise Value E. Equity...
A) What is the present value of this cash flow at 8% discount
rate?
B) What is the present value of this cash flow at 14% discount
rate?
C) What is the present value of this cash flow at 27% discount
rate?
Different cash flow. Given the following cash inflow, what is the present value of this cash flow at 8%, 14%, and 27% discount rates? Year 1 Year 2: Years 3 through 7: Year 8: $1,000 $5,000 $0 $25,000
Different cash flow. Given the following cash inflow, what is the present value of this cash flow at 3%, 13%, and 24% discount rates? Year 1 Year 2: Years 3 through 7: Year 8: $1,000 $6,000 SO $26,000 What is the present value of this cash flow at 3% discount rate? SL (Round to the nearest cent.) What is the present value of this cash flow at 13% discount rate? SL (Round to the nearest cent.) What is the present...
What is the Net Present Value (NPV) for the below series of project cash flows, assuming a discount rate of 7%? Year Cash Flow CY ($450,000) CY+1 $79,000 CY+2 $125,000 CY+3 $140,000 CY+4 $135,000 CY+5 $45,000 a. $102,991 b. ($17,631) c. $22,991 d.($16,478)
Net Present Value/Cash Flow Estimation word problem.
Information is given below.
(view pictures)
FINA 440 Net Present Value Panda Snow Suits Panda Children's Clothing Company is considering expanding its product lines into snow suits. It has spare capacity on its sewing machinery, but would need to buy a new cutting machine for $40000. It expects to increase labor costs by S4000 in the first year, materials by $6,000 in the first year, and overheads by $2000. Sales for the new...
Most questions answered within 3 hours.
-
A 8.15- g bullet from a 9-mm pistol has a velocity of 366.0 m/s.
It strikes...
asked 34 minutes ago -
The outstanding bonds of Alpha Extracts have a yield to maturity
of 7.4 percent and a...
asked 31 minutes ago -
The Problem: The Case of the Harmonizing Vacations
Your CEO is exploring partnering with a European...
asked 1 hour ago -
A chemical equation is balanced by adding coefficients in front
of some formulas so that the...
asked 1 hour ago -
From the literature (reference your sources): What are the
lattice parameters of calcite and aragonite? Why...
asked 2 hours ago -
Your system is rejecting the question am asking which is
preceded by a case study. It...
asked 2 hours ago -
3. On January 2, 2000, Larry creates a trust with himself as
trustee. Larry as trustee...
asked 2 hours ago -
A member of the volleyball team spikes the ball. During this
process, she changes the velocity...
asked 2 hours ago -
Are adult gamers less likely to use a gaming console (Xbox,
PlayStation, Wii, etc...) than teen...
asked 3 hours ago -
The University of
Texas recently reported that 43% of college students aged 18-24
would spend their...
asked 3 hours ago -
The length of stay at a specific emergency department in
Phoenix, Arizona, in 2009 had a...
asked 3 hours ago -
. Please give the mechanism for this type of problem. Step by
Step
The toxin that...
asked 3 hours ago