1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Ipatiy [6.2K]
3 years ago
12

You must estimate the intrinsic value of Noe Technologies’ stock. The end-of-year free cash flow (FCF1) is expected to be $27.50

million, and it is expected to grow at a constant rate of 7.0% a year thereafter. The company’s WACC is 10.0%, it has $125.0 million of long-term debt plus preferred stock outstanding, and there are 15.0 million shares of common stock outstanding. What is the firm's estimated intrinsic value per share of common stock? $48.64 $50.67 $52.78 $54.89 $57.08
Business
1 answer:
emmasim [6.3K]3 years ago
3 0

Answer:

= $52.78 per share

Explanation:

<em>The value of a business can be determined using the free cash flow model. According to this model, the value of a firm is is the present value of its free cash flow discounted at the weigthed average cost of capital (WACC.)</em>

<em>The value of equity is the value of firm less value of other instruments (e.g debt and preferred stocks)</em>

<em>Value of equity = Value of the entire firm - Value of debt </em>

We can work out the the value per share using the steps below:

<em>Step 1</em>

<em>Calculate the total value of the firm</em>

Value of firm =  27.50/(0.1-0.07)

 = $916.66 million

<em>Step 2</em>

<em>Calculate the value of equity</em>

<em>Value of equity = Value of the entire firm - Value of debt</em>

= $916.66 million - $125.0 million

=791.666 million

<em>Step 3</em>

<em>Calculate the value per share</em>

Value per share = Value of equity/ units of common stock

=$791.666 million/15 million units

= $52.78 per share

You might be interested in
What is allowable self-employment plan contributions.
matrenka [14]
<h3><em>Answer:</em></h3><h3><em>Answer:For a self-employed individual, contributions are limited to 25% of your net earnings from self-employment (not including contributions for yourself), up to $61,000 for 2022 ($58,000 for 2021; $57,000 for 2020). You can calculate your plan contributions using the tables and worksheets in Publication 560</em></h3>
4 0
3 years ago
Match each economic activity with one of its purpose
Verizon [17]

A. World Bank loans: Eliminate poverty

The World Bank is an international organization committed to giving financing, counsel and research to creating countries to help their monetary progression. The World Bank was made out of the Bretton Woods agreement, because of numerous European and Asian nations requiring financing to finance reproduction endeavors. Starting at 2016, the Bank predominantly goes about as an association that endeavors to battle destitution by offering formative help to center and poor-pay nations.  


B. Foreign aid: Provide emergency relief

Foreign aid is characterized as the intentional exchange of assets starting with one nation then onto the next nation. This exchange incorporates any stream of money to creating nations.  

Foreign aid can be as a credit or an allow. It might be in either a delicate or hard advance. This refinement implies that in the event that reimbursement of the guide requires remote money, it is a hard advance. In the event that it is in the home cash, it's a delicate advance. The World Bank loans in hard credits, while the advances of its offshoots are delicate advances.


C. Trade embargo: Punish an offending government

A trade embargo is a governmental request to confine exchange of specific products or all merchandise altogether with an outside nation. This normally originates from political contrasts between the two countries or monetary conditions that make business exchange unwanted.  

Trade embargos limit exchange between nations for an assortment of reasons. The most widely recognized reason is political clashes between the countries.


D. Outsourcing: Reduce production costs

Outsourcing is the business routine with regards to contracting a gathering outside an organization to perform benefits and make products that customarily were performed in-house by the organization's own representatives and staff. Normally done as a cost-cutting measure, it can influence employments extending from client support to assembling to the back office.  

Outsourcing was first perceived as a business technique in 1989 and turned into an indispensable piece of business financial aspects all through the 1990s.

5 0
3 years ago
Read 2 more answers
If a rise in incomes is the same proportion for both low-income and high-income workers, then poverty will rise and inequality w
Nonamiya [84]

Then poverty will fall and inequality will rise.

<h3>What is poverty?</h3>
  • Being in a state of poverty means having few material possessions or little money.
  • Numerous social, economic, and political factors can contribute to or be a result of poverty.
  • There are two primary metrics of poverty used in statistics and economics: Relative poverty is the inability of a person to maintain a minimal standard of living in comparison to others in the same period and place.
  • Absolute poverty is the comparison of income to the amount required to meet fundamental personal necessities, such as food, clothing, and shelter.
  • Depending on the community or the country, many terms are used to define relative poverty.
<h3>What is income inequality?</h3>
  • The disparity in how income is allocated among people or populations is known as income inequality.
  • It is also known as the wealth gap, wealth disparity, wealth and income discrepancies, or the gap between the rich and the poor.
  • Therefore, the poverty will fall and inequality will rise.

Know more about absolute poverty here:

brainly.com/question/2264730

#SPJ4

3 0
2 years ago
Anson Apparel's marketing message in the United States is one of apparel for the rugged man who spends most of his time outdoors
crimeas [40]

Answer:

Customer landscape: customers' habits, values and preferences related to rugged men. Market landscape: apparel alternatives available in the Chinese market; share market distribution; competitors brand positioning.

Explanation:

The marketing message is the result of marketing strategy based on situational conditions of the company in the US, that market is different from the Chinese market so that the strategic analysis could find as a result a different message more appealing for rugged men in China.

8 0
3 years ago
QUESTION 20 Which of the following is defined as a planned, systematic process of change that uses behavioral science knowledge
Pachacha [2.7K]

Answer:

The correct answer is : B. Organization development (OD)

Explanation:

It is a process which can help organizations and companies to build their capacity to change. It also helps to achieve better effectiveness. What it is required to do so is to reinforce, improve and develop strategies, processes and if it is the case different structures

7 0
3 years ago
Other questions:
  • Which of the following statement is TRUE about variable expenses?
    6·2 answers
  • Internationalization is the vision of creating one world unit, a single market entity.
    14·1 answer
  • Heidi Ganahl says Camp Bow Wow promotes a scrappy "we-can-conquer-all" work attitude that helps individuals overcome challenges.
    6·1 answer
  • Tyge Corporation recorded the following activities during its first month of operations. Purchased materials costing $300,000.
    9·1 answer
  • Selected data from the Florida Fruit Company are presented below: Total assets $1,500,000 Average total assets 1,850,000 Net inc
    5·1 answer
  • ohn wants to start his own fruit juice and beverage company. He is aware of the large number of competitors in this industry and
    13·1 answer
  • Use the following account balances from the adjusted trial balance of Gees Catering: Account Debit Balance Credit Balance Cash 1
    14·1 answer
  • 6) Una escuela tiene un total de 475 estudiantes. Se quiere extraer una muestra de 80. Explica en detalle cómo se obtiene dicha
    5·1 answer
  • At December 31, 2019, Obermeyer Imports reported the following information on its balance sheet.
    8·1 answer
  • Bodbbm177 Corporation makes two products, Light and Heavy. These two products emerge from a joint process. Product Light has bee
    11·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!