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What is the per-share estimate of the stock intrinsic value

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Reference no: EM132964110

Corporate valuation model

Problem 1: You have been assigned the task of using the corporate valuation model to estimate Balboa Co.'s intrinsic value. Balboa's WACC is 10.00%, its expected end-of-year free cash flow (FCF) is $150 million, the FCFs are expected to grow at a constant rate of 4.00% a year in the future, the company has $300 million of long-term debt plus preferred stock, and it has 100 million shares of common stock outstanding. What is the per-share estimate of the stock's intrinsic value?

a. $12.00

b. $18.75

c. $22.00

d. $25.00

e. $34.50

Reference no: EM132964110

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