Estimate the per share price of milford common stock

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Question 1: Milford Company has never paid a dividend. As a result, you decide to use the free cash flow approach to estimate the value of the firm's common stock. Free cash flow is currently $1,500,000. Free cash flow is expected to grow at a constant 6 percent annual rate. The weighted average cost of capital is 8.50 percent. The firm's short-term investments equal $5,000,000, the firm's short-term and long-term debt totals $25,000,000. There is no preferred stock. The number of outstanding shares equals 1,500,000. Estimate the per share price of milford's common stock.

Reference no: EM132894289

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