Estimate the enterprise value of heavy metal

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Reference no: EM131851185

Heavy Metal Corporation is expected to generate the following free cash flows over the next five? years: Year 1 2 3 4 5 FCF? ($ million) 53.6 69.7 79.4 73.3 82.4 ?Thereafter, the free cash flows are expected to grow at the industry average of 3.9 % per year. Using the discounted free cash flow model and a weighted average cost of capital of 14.4 %?:

a. Estimate the enterprise value of Heavy Metal.

b. If Heavy Metal has no excess? cash, debt of $ 301 ?million, and 42 million shares? outstanding, estimate its share price.

Reference no: EM131851185

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