Calculate the share price for Novartis

Reference no: EM133249365

Question - You expect Novartis Corporation to generate the following free cash flows over the next four years:

Year	1	2	3	4
FCFF ($ million)	25	28	32	37

Following year four, you estimate that Novartis' free cash flows will grow at 4% per year and that Novartis' weighted average cost of capital is 12%.

Assume Novartis' has $120 million of debt and 15 million shares of stock outstanding, calculate the share price for Novartis.

a. $18.44

b. $26.44

c. $34.44

d. $17.65

e. None of the above

Reference no: EM133249365

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