A firm has free cash flow to the firm equal to 150 million


A firm has free cash flow to the firm equal to $150 million in year 1 and that cash flow is expected to grow at 2% forever. What is the value of share of stock, if WACC is 9.5%, cost of equity is 12%, the value of debt is $500 million and there are 110 million shares outstanding? Solve answer step by step.

 

 

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Finance Basics: A firm has free cash flow to the firm equal to 150 million
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