After year 3 the company anticipates increasing free cash


A company has projected this information for the next three years.

Year1 Year 2 Year 3

Sales $541 million $643 million $678 million

Costs $251 million $301 million $321 million

Depreciation $100 million $100 million $100 million

EBIT $190 million $242 million $257 million

Taxes (34%) $64.6 million $82.3 million $87.4 million

CAPEX $79 million $83 million $87 million I

Increases in NWC $21 million $23 million $24 million

After Year 3, the company anticipates increasing free cash flows at a rate of 2% per year, indefinitely. The weighted average cost of capital is 11.5%.

What is the value of this firm?

Round your answer to two decimal places.

Solution Preview :

Prepared by a verified Expert
Finance Basics: After year 3 the company anticipates increasing free cash
Reference No:- TGS02781307

Now Priced at $10 (50% Discount)

Recommended (95%)

Rated (4.7/5)