d. Calculate the current value of operations. (Hint: First calculate the horizon

d. Calculate the current value of operations. (Hint: First calculate the horizon value at the end of the forecast period, which is equal to the value of operations at the end of the forecast period. Assume that the annual growth rate beyond the horizon is equal to the growth rate at the horizon.) How does the current value of operations compare with the current amount of total net operating capital?Weighted average cost of capital (WACC) 10.5% Actual Projected Projected Projected Projected 12/31/2019 12/31/20 12/31/21 12/31/22 12/31/23 Free cash flow na $101.2 $111.3 $117.1 $125.1 Long-term constant growth in FCF6.0% Horizon value (Terminal Value) 1,793.6 Present value of horizon value $1,203.0Present value of forecasted FCF $126.6Value of operations (]PV of HV] + [PV of FCF]) $1,329.6Total net operating capital $792.0Answer: $792.0
Requirements: 1Hrs

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