ZuoTi.Pro
Question
please help me answer those questions
1.

You estimate that a companys enterprise value is $ 70 million. If it has $10 million debt outstanding, $2 million in cash, a
2

A company is projected to generate free cash flows of $10 million per year for the next two years, followed by a stable growt
business   finance   
0 0
Add a comment Improve this question Transcribed image text
Next > < Previous
Sort answers by oldest

Homework Answers

Answer #1

Solution to QUESTION-1

Estimated stock price

Estimated stock price = Total value of equity / Number of common shares outstanding

= [Enterprise value + Cash – Debt] / Number of common shares outstanding

= [$70 Million + $2 Million - $10 Million] / 5 Million shares outstanding

= $62 Million / 5 Million shares outstanding

= $12.40 per share

“Hence, the Estimated stock price will be $12.40”

0 0
Add a comment
Know the answer?
Add Answer to:
please help me answer those questions 1. 2 You estimate that a company's enterprise value is...
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for? Ask your own homework help question. Our experts will answer your question WITHIN MINUTES for Free.
Similar Homework Help Questions

  • RA 4.5 Homework • Unanswered A company's enterprise value is $90 million. If it has $20...

    RA 4.5 Homework • Unanswered A company's enterprise value is $90 million. If it has $20 million debt outstanding, $2 million in cash, and there are 15 million shares outstanding, what's its price per share? Round to the nearest cent. [Hint: You are not supposed to do DCF valuation here. One of the formulas on the DCF page shows you how to find a company's stock price easily if you already know its enterprise value.] Numeric Answer: 4.4 You are...

  • I know you have a rule that you can only answer one question, but my time...

    I know you have a rule that you can only answer one question, but my time is running out and I still have a lot of questions to solve. Please give me an accommodation. If you just answer one question, please don't want to answer this question, please don't. 1 2 A company is projected to generate free cash flows of $40 million per year for the next two years, after which it is projected grow at a steady rate...

  • You estimate that a company's enterprise value is $189 million. If it has $66 million debt,...

    You estimate that a company's enterprise value is $189 million. If it has $66 million debt, $12 million in cash, and there are 11 million shares outstanding, what should be its stock price? Round to one decimal place.

  • answer A and B? Me Remaining! 02:28:03 Submit Quiz This Question: 1 pt 2 of 10...

    answer A and B? Me Remaining! 02:28:03 Submit Quiz This Question: 1 pt 2 of 10 (1 complete) This Quiz: 10 pts possible Heavy Metal Corporation is expected to generate the following free cash flows over the next five ye Year FCF (5 million) 532 68.7 76.4 75.3 83.6 Thereafter, the free cash flows are expected to grow at the industry average of 4.5% per year. Using the discounted free cash flow model and a weighted average cost of capital...

  • A company is projected to generate free cash flows of $41 million per year for the...

    A company is projected to generate free cash flows of $41 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 12.6%. It has $21 million worth of debt and $8 million of cash. There are 11 million shares outstanding. If the appropriate terminal exit value for this company is 15, what's your estimate of the company's stock price? Round to one decimal place.

  • A company is projected to generate free cash flows of $47 million per year for the...

    A company is projected to generate free cash flows of $47 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 11.2%. It has $24 million worth of debt and $6 million of cash. There are 14 million shares outstanding. If the appropriate terminal exit value for this company is 14, what's your estimate of the company's stock price? Round to one decimal place.

  • A company is projected to generate free cash flows of $47 million per year for the...

    A company is projected to generate free cash flows of $47 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 11.2%. It has $24 million worth of debt and $6 million of cash. There are 14 million shares outstanding. If the appropriate terminal exit value for this company is 14, what's your estimate of the company's stock price? Round to one decimal place.

  • 8. A company is projected to generate free cash flows of $60 million per year for...

    8. A company is projected to generate free cash flows of $60 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 8.0%. It has $30 million worth of debt and $3 million of cash. There are 20 million shares outstanding. If the exit multiple for this company's free cash flows (EV/FCFF) is 12, what's your estimate of the company's stock price? Round to...

  • Question 9 Homework. Unanswered A company is projected to generate free cash flows of $40 million...

    Question 9 Homework. Unanswered A company is projected to generate free cash flows of $40 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 13.0%. It has $20 million worth of debt and $8 million of cash. There are 10 million shares outstanding. If the appropriate terminal exit value for this company is 15, what's your estimate of the company's stock price? Round...

  • 1. An annual coupon bond has a coupon rate of 5.4%, face value of $1,000, and...

    1. An annual coupon bond has a coupon rate of 5.4%, face value of $1,000, and 4 years to maturity. If its yield to maturity is 5.4%, what is its Modified Duration? Round to three decimal places. 2. A semi-annual coupon bond has MacD of 23.6 years, yield-to-maturity of 6.6%, and price of $1071.43. What is its DV01? Answer in dollars, rounded to three decimal places. 3. You own a bond portfolio worth $31,000. You estimate that your portfolio has...

ADVERTISEMENT
Free Homework Help App
Download From Google Play
Scan Your Homework
to Get Instant Free Answers
Need Online Homework Help?
Ask a Question
Get Answers For Free
Most questions answered within 3 hours.
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT