subject
Business, 16.10.2019 23:00 keyshlavazquez5118

Suppose you were trying to value box prior to its ipo using the free cash flow model. you estimate that box has $34,000,000 of debt, no preferred stock, no short-term investments, and will not produce positve free cash flows until 5 years from now. you further estimate that box has a weighted average cost of capital of 15% and will settle down to a constant growth rate of 5%. what is the minimum fcf that box would need to generate in year 5 to be valued as a $1 billion dollar company at its ipo today. for simplicity, assume that fcf in periods 1 through 4 are zero. answer in millions of dollars (e. g., if the answer is one billion dollars enter 1,000 not 1,000,000,000).

ansver
Answers: 2

Another question on Business

question
Business, 22.06.2019 04:00
Last week paul, ceo of quality furniture in south carolina, traveled to europe to visit customers. while overseas, paul checked his e-mail daily and showed his company's website to customers, explaining how the website will them place orders and receive merchandise more quickly. after visiting the last customer friday morning, paul was able to return to the corporate office in south carolina to meet with his board of directors that night. is the "shrinking" of time and space with air travel and electronic media.
Answers: 1
question
Business, 22.06.2019 06:30
The larger the investment you make, the easier it will be to: get money from other sources. guarantee cash flow. buy insurance. streamline your products.
Answers: 3
question
Business, 22.06.2019 07:30
Why has the free enterprise system been modified to include some government intervention?
Answers: 1
question
Business, 22.06.2019 21:10
Krier industries has just completed its sales forecasts and its marketing department estimates that the company will sell 43,800 units during the upcoming year. in the past, management has maintained inventories of finished goods at approximately 3 months' sales. however, the estimated inventory at the start of the year of the budget period is only 7,300 units. sales occur evenly throughout the year. what is the estimated production level (units) for the first month of the upcoming budget year?
Answers: 3
You know the right answer?
Suppose you were trying to value box prior to its ipo using the free cash flow model. you estimate t...
Questions
question
Mathematics, 27.08.2021 20:20
question
Health, 27.08.2021 20:20
question
History, 27.08.2021 20:20
Questions on the website: 13722362