Depreciation and the increase in net working capital

Assignment Help Financial Management

Reference no: EM131456372

Ward Corp. is expected to have an EBIT of $2,300,000 next year. Depreciation, the increase in net working capital, and capital spending are expected to be $173,000, $101,000, and $123,000, respectively. All are expected to grow at 16 percent per year for four years. The company currently has $17,000,000 in debt and 830,000 shares outstanding. After Year 5, the adjusted cash flow from assets is expected to grow at 3 percent indefinitely. The company’s WACC is 8.8 percent and the tax rate is 40 percent. What is the price per share of the company's stock?

Reference no: EM131456372

Questions Cloud

What is a point estimate of the proportion of companies : Many stock market observers say that when the P/E ratio for stocks gets over 20 the market is overvalued. The PIE ratio is the stock price divided by the most.

Why is the type of technology necessary in the united states : Why is this type of technology necessary in the United States? Would the implementation / testing be permissible for the private sector?

Urgent need to improve healthcare quality : This will be the foundation for future discussions by your classmates. Be substantive and clear, and use examples to reinforce your ideas.

Reconsider the fingroup fund in the previous problem : Reconsider the Fingroup Fund in the previous problem. what is the portfolio turnover rate?

Depreciation and the increase in net working capital : Depreciation, the increase in net working capital, and capital spending are expected to be $173,000, $101,000, and $123,000, respectively

What is the sample mean number of minutes required : US Airways conducted a number of studies that indicated a substantial savings could be obtained by encouraging Dividend Miles frequent flyer customers.

Why was president andrew johnson impeached : Choose three (3) wars in which the United States participated during the period covered by this course (the Cold War may be one of your choices).

Explain whether or not government should extend civil rights : "Should Terrorists Have Legal Protection?" Explain whether or not government should extend same civil rights to terrorism suspects that American citizens enjoy.

Determine the effective annual return on the bond investment : Determine the effective annual return on the bond investment.

User Account

All Pages