Reference no: EM133491843

Question 1. Brandtly Industries invests a large sum of money in R&D; as a result, it retains and reinvests all of its earnings. In other words, Brandtly does not pay any dividends, and it has no plans to pay dividends in the near future. A major pension fund is interested in purchasing Brandtly's stock. The pension fund manager has estimated Brandtly's free cash flows for the next 4 years as follows:

$2 million, $5 million, million, and $14 million.

After the fourth year, free cash flow projected to grow at a constant Brandtly's WACC is 10%, the market value of its debt and preferred stock totals $48 million, the has $16 in nonoperating assets, and it has 15 million shares of common stock outstanding What is the present value of the free cash flows projected during the next 4 yearsDo not round intermediate calculations ound your answer to the nearest dollarWrite out your answers completelyFor example, 13 million should be entered as 13,000,000 $ What is the firm's horizon, or continuing, value? Round your answer to the nearest dollarWrite out your answers completelyFor example, 13 should be entered as 13,000,000 What is the market value of the company's operations?

Do not round intermediate

calculations Round your answer to the nearest Write out your answers completely.

For example, 13 million should be entered as 13,000,000 What is the firm's total market value today? Do not round intermediate calculations Round your answer to the nearest dollar. Write out your answers completelyFor example, 13 should be entered as 13,000,000 What is an estimate of Brandtly's price per share? Do not round intermediate calculationsRound your answer to the nearest cent

Question 2, Maxwell Mining Company's ore reserves are being depleted, so its sales are fallingAlso, because its pit is getting deeper each year, its costs are risingAs a result, the company's earnings and dividends are declining at the constant rate of 3% per

year. If Do = plus/minus 3 and f_{1} = 9%

what is the value of Maxwell Mining's stock? Round your answer to the nearest cent

Question 3, Computech Corporation is expanding rapidly and currently needs to retain all of its earnings; hence, it does not pay dividends. However, investors expect Computech to begin paying dividends, beginning with a dividend of $1.75 coming 3 years from today. The dividend should grow rapidlyat a rate of 37 % per yearduring Years 4 and 5, but after Year 5, growth should be a constant 8% per year. If the required return on Computech is 16%, what is the value of the stock today? Do not round intermediate calculations Round your answer to the nearest cent

Question 4, Dantzler Corporation fast-growing supplier of office products. Analysts project the following free cash flows (FCFS) during the next 3 years, after which FC is expected to grow at a constant % rate. Dantzler's WACC is 10% Year FCP) $ 25 3157 What Dantzler's
at a constant % rate. Dantzler's WACC is 10% Year FCP ) $ 25 3157 What Dantzler's horizon, or continuing, value? (Hint: Find the value of all free cash flows beyond Year 3 discounted back to Year 3.) Enter your answer example, an answer of $13,550,000 should be entered as 13.55. Do not round intermediate calculations. Round your answer to two decimal places million What is the firm's market value today? Assume that Dantzler has zero nonoperating assets.

Enter your answer in millions. For example, an answer of $13,550,000 should be entered as 13.55. Do not round intermediate calculationsRound your answer to two decimal places Suppose Dantzler has $134.70 million of debt and 31 million shares of stock outstanding. What is your estimate of the current price per share? Write out your answer completelyFor example, 0.00025 million should be entered as 250.

Do not round intermediate calculations.

Round your answer to the nearest