Horizon Value of Free Cash Flows Current and projected free cash flows for Radell Global Operations...

Horizon Value of Free Cash Flows Current and projected free cash flows for Radell Global Operations are shown below.

Actual 2016	2017	Projected 2018	2019
Free cash flow	$602.40	$663.08	$703.13	$759.38
(millions of dollars)

Growth is expected to be constant after 2018, and the weighted average cost of capital is 11.55%. What is the horizon (continuing) value at 2019 if growth from 2018 remains constant? Round your answer to the nearest dollar. Round intermediate calculations to two decimal places.

Expert Solution

jeff jeffy answered 1 year ago

Emma Limited’s current and forecasted free cash flows to the firm (FCFF) over the forecast horizon...

Emma Limited’s current and forecasted free cash flows to the firm (FCFF) over the forecast horizon and the terminal period are as follows ($ millions): ($ millions) Current Forecast Horizon Terminal Period 2020 2021 2022 2023 2024 2025 FCFF 1,697 1,799 1,907 2,021 2,051 2,082 Valuation assumptions and other information for Emma Limited are as follows: Terminal growth rate 1.5% Shares outstanding in millions 2,250 Net nonoperating obligations (NNO) ($ millions) 9,000 WACC 8.00% REQUIRED: Estimate Emma Limited’s equity...

A company is projected to generate free cash flows of $100 million per year for the...

A company is projected to generate free cash flows of $100 million per year for the next 3 years (FCFF1, FCFF2 and FCFF3). Thereafter, the cash flows are expected to grow at a 3.0% rate in perpetuity. The company's cost of capital is 7.0%. What is your estimate for its enterprise value? Answer in millions, rounded to one decimal place (e.g., $213,456,789 = 213.5).

A company is projected to generate free cash flows of $164 million per year for the...

A company is projected to generate free cash flows of $164 million per year for the next 3 years (FCFF1, FCFF2 and FCFF3). Thereafter, the cash flows are expected to grow at a 2.0% rate in perpetuity. The company's cost of capital is 10.2%. What is your estimate for its enterprise value? Answer in millions, rounded to one decimal place (e.g., $213,456,789 = 213.5).

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 exit multiple for this company's free cash flows (EV/FCFF) is 14, what's your estimate of the company's stock price? Round to one...

Explain how "cash flows" and "free cash flows" influence the "value" and "valuation" of an organization....

Explain how "cash flows" and "free cash flows" influence the "value" and "valuation" of an organization. Be specific. Be sure to discuss each section of the statement of cash flows.

6. The table below shows the projected free cash flows of an acquisition target. Estimate the...

6. The table below shows the projected free cash flows of an acquisition target. Estimate the following: a) Terminal value at the end of 2025 based on the perpetual growth equation with a 4% perpetual growth rate b) Maximum acquisition price (MAP) as of the end of 2020 at a 9% discount rate YEAR 2021 2022 2023 2024 2025 FREE CASH FLOW ($ thousands) -$500 $83 $87 $89 $92 The Present Value of $1 Table (Table 3)...

Company is projected to generate free cash flows of $179 million per year for the next...

Company is projected to generate free cash flows of $179 million per year for the next 3 years (FCFF1, FCFF2 and FCFF3). Thereafter, the cash flows are expected to grow at a 1.8% rate in perpetuity. The company's cost of capital is 10.9%. What is your estimate for its enterprise value? Answer in millions, rounded to one decimal place

A company is projected to generate free cash flows of $178 million next year and $191...

A company is projected to generate free cash flows of $178 million next year and $191 million at the end of year 2, after which it is projected grow at a steady rate in perpetuity. The company's cost of capital is 13.6%. It has $107 million worth of debt and $77 million of cash. There are 21 million shares outstanding. If the exit multiple for this company's free cash flows (EV/FCFF) is 7.7, what's your estimate of the company's stock...

A company is projected to generate free cash flows of $171 million next year and $196...

A company is projected to generate free cash flows of $171 million next year and $196 million at the end of year 2, after which it is projected grow at a steady rate in perpetuity. The company’s cost of capital is 12.3%. It has $129 million worth of debt and $69 million of cash. There are 23 million shares outstanding. If the exit multiple for this company’s free cash flows (EV/FCFF) is 6.9, what’s your estimate of the company’s stock...

1.A. A company is projected to generate free cash flows of $800 million per year for...

1.A. A company is projected to generate free cash flows of $800 million per year for the next 3 years (FCFF1, FCFF2 and FCFF3). Thereafter, the cash flows are expected to grow at a 1.5% rate in perpetuity. The company's cost of capital is 12.0%. The company owes $100 million to lenders and has $90 million in cash. If it has 150 million shares outstanding, what is your estimate for its stock price? Round to one decimal place 1.B. A...

Question