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Fley Airline

Company Valuation Fley Airline Supply is trading at $15/share but you think that price may not be right. You have the following data and you want to use it to calculate its share price: Gross Sales $124M COGS 54% of sales General & Admin $3.5M Annual Sales Growth Rate 3.0% Advertising, Promotion & Selling $5M Yearly Inflation for non-COGS expenses 3.3% Tax Rate 21% Discount Rate 8% Cash Balance $3M Debt $5M Share o/s $44M Cash Flow Adjustment Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Working Capital 2.0 (2.0) (1.2) (0.3) (1.0) (2.0) Capital Expenditures (2.0) (2.0) (3.0) (4.0) (4.0) (4.0) Calculate the per share price and run sensitivities for growth rates of 3.0%, 3.5%, and 4% as well as discount rates of 8%, 9%, and 10%. Put these in a matrix.

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