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According to the equity free cash flow model

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Reference no: EM132053734

Year 0 1 Revenue 850.00

Fixed costs 100.00

Variable costs 200.00

Additional investment in NWC 10.00

Additional investment in operating long-term assets 70.00

Depreciation 60.00

Interest expenses 35.00

Newly issued debt 25.00

Principle repayments 15.00

Net change in debt 10.00

Tax rate 0.40

Market value of the firm:

Price per share No. of shares Market value Short-term debt 100.00

Long-term debt 600.00

Preferred stock 10.00 10 100.00

Common stock, equity 18.00 100 1,800.00

Total 2,600.00

Cost of equity (Rs) 0.1400

Growth rate per year from year 1 through year 5 0.12

Growth rate after year 5 0.05

According to the equity free cash flow model, what is the stock price per share?

Reference no: EM132053734

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