Suppose that XYZ Corp. will generate free-cash-flows (FCF) of $400 at the end of the year. XYZ has a cost of equity capital of 12%, a cost of debt capital of 5%, a market value debt-to-equity ratio of 0.5, and faces a 21% tax rate. Assuming that XYZ’s FCF will grow by 3% per year in the future, what is the value of XYZ Corp? Round your final answer to two decimals?
Assuming that XYZ’s FCF will grow by 3% per year in the future, what is the value of XYZ Corp?
=400/(0.5/1.5*5%*(1-21%)+1/1.5*12%-3%)
=6332.453826
Suppose that XYZ Corp. will generate free-cash-flows (FCF) of $400 at the end of the year. XYZ has a cost of equity capi...
1 Suppose that XYZ Corp. will generate free-cash-flows (FCF) of $200 at the end of the year. XYZ has a cost of equity capital of 10%, a cost of debt capital of 5%, a market value debt-to-equity ratio of one, and faces a 21% tax rate. Assuming that XYZ’s FCF will grow by 3% per year in the future, what is the value of XYZ Corp? Round your final answer to two decimals? 2 Suppose that XYZ Corp. will generate...
1. Suppose that XYZ Corp. will generate free-cash-flows (FCF) of $200 at the end of the year. XYZ has a cost of equity capital of 10%, a cost of debt capital of 5%, a market value debt-to-equity ratio of one, and faces a 21% tax rate. Assuming that XYZ’s FCF will grow by 3% per year in the future, what is the value of XYZ Corp? Round your final answer to two decimals? 2. Suppose that XYZ Corp. will generate...
Suppose that XYZ Corp. will generate free-cash-flows (FCF) of $300 at the end of the year. XYZ has a cost of equity capital of 15%, a cost of debt capital of 5%, a market value debt-to-equity ratio of 0.5, and faces a 21% tax rate. Assuming that XYZ’s FCF will grow by 3% per year in the future, and XYZ Corp. has in debt with a market value of $2000, what is the value of XYZ’s Corp. equity? Round your...
Suppose that TXY Corp. will currently generate free-cash-flows (FCF) of $300 at the end of the year. TXY has a cost of equity capital of 20%, a market value debt-to-equity ratio of zero, and faces a 21% tax rate. Assuming that TXY's FCF will grow by 3% per year in the future, and any new debt would be risk-free and carry a 5% interest rate, what would be the value of the interest tax shields created if TXY's market value...
1. Suppose that QRY Corp. has an equity beta of 1.5. Current risk-free rates are 5% and the expected return on the market portfolio is 15%. QRY Corp has a market value debt-to-equity ratio of 0.5, debt that is rated AAA, and faces a 21% tax rate. QRY Corps debt is rate AAA and has an average maturity of 10 years. Assuming that the current market price of AAA bonds paying 5% semi-annual coupon, with 10 years maturity, and par...
1. Suppose that ABC Corp. has an equity beta of 1.5. Current risk-free rates are 5% and the expected return on the market portfolio is 15%. ABC Corp has a market value debt-to-equity ratio of 0.5, debt that is rated AA, and faces a 21% tax rate. Assuming that the credit spread on AA debt is 2%, compute ABC Corps WACC? Enter your answer as a percent without the % sign. Round to two decimals. 2. Suppose that QRY Corp....
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