State free cash flows are expected to grow at constant rate

Assignment Help Financial Management

Reference no: EM13215276

Walleye Feeders Inc. Valuations

See the table below showing a three-year forecast for Walleye Feeders Inc. and complete the following valuation scenarios:

Year 2013 2014 2015

Free cash flow ($ millions) $-20 $48 $54

1. Estimate the fair market value of Walleye Feeders at the end of 2012. Assume that after 2015, free cash flows are expected to grow at a constant rate of 12.5% and Walleye Feeders' weighted-average cost of capital is 14 percent.

2. Estimate the fair market value per share of Walleye Feeders' equity at the end of 2012 if the company has 50 million shares outstanding and the market value of its interest-bearing liabilities on the valuation date equals $55 million.

Reference no: EM13215276

Questions Cloud

Plans call for the following numbers of washing machines : Bindley Corporation has a one-year contract to supply motors for all washing machines produced by Rinso Ltd.

Value of royalties flowing-particular licensing agreement : As a technology supplier, what means would you use to calculate the value of royalties flowing from a particular licensing agreement?

Which particular software products are used at your company : Which particular software products are used at your company?

Determine the payback period of the investment : The management of Weimar, Inc., a civil engineering design company, is considering an investment in a high-quality blueprint printer with the following cash flows: Year Investment Cash Inflow 1 $54,000 $5,0002 $7,000 $10,000

State free cash flows are expected to grow at constant rate : Estimate the fair market value of Walleye Feeders at the end of 2012. Assume that after 2015, free cash flows are expected to grow at a constant rate of 12.5% and Walleye Feeders' weighted-average cost of capital is 14 percent.

Conduct analysis of the quality management tools : Conduct analysis of the quality management tools and techniques that are used in project quality planning, project quality assurance, and project quality control.

How vulnerable do think the united states is to such attack : How would the actions of a hostile nation be any different than the actions of a hostile (competing) foreign company?

What is the dealers final price : What percent is the rebate? Round to nearest hundredth percent, what is the amount of the cash discount if the dealer pays within 15 days and what is the dealer's final price

Why the company incurs variable manufacturing costs : Inman Manufacturing Company makes a product that it sells for $60 per unit. The company incurs variable manufacturing costs of $31 per unit. Variable selling expenses are $5 per unit, annual fixed manufacturing costs are $191,000, and fixed sellin..

User Account

All Pages