Nikul Consider the table given below to answer the following question. The long-run growth rate is projected at 7% and discount rate is 10%YearAsset valueEarningsNet investmentFree cash flow (FCF)Return on equity (not)Asset growth rateEarnings growth rate71.301.3010.00 11.30 12.77 14.43 15.87 17.46 19.20 20.55 21.991.47 1.66 1.88 2.06 2.18 2.30 2.36 1.981.47 1.66 1.44 1.59 1.75 1.34 1.44 1.540.43 8.48 0.44 0.96 0.92 0.440.13 0.13 0.1250.10 0.10 0.100.12 0.115 0.090.13 0.130.13 0.130.13 0.13 0.13 0.10 0.00 0.00 0.05-0.16 0.070.07 0.07 0.07 0.07Present value0.130.132023.532.121.65Assuming that competition drives down profitability (on existing assets as well as new investment) to 12.5% in year 6, 12% in year 7,11.5% in year 8, and 9% in year 9 and all later years. What is the value of the concatenator business? (Do not round intermediatecalculations. Enter your answer in millions rounded to 2 decimal places.)million8.470.09

Name: Nikul Consider the table given below to answer the following question.
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Description: Nikul Consider the table given below to answer the following question. The long-run growth rate is projected at 7% and discount rate is 10%YearAsset valueEarningsNet investmentFree cash flow (FCF)Return on equity (not)Asset growth rateEarnings growth

Free cash flows (FCF) represent the cash generated by a company's operations after accounting for…

Business

Finance

Consider the table given below to answer the following question. The long run growth rate is projected at 7% and discount rate is 10% Year Asset value Earnings Net invest Free cash flow (FCF) Return on equity (ROE) Asset growth rate Earnings growth rate 10.00 11.30 12.77 14.43 15.87 17.46 19.20 20.55 21.99 23.53 1.30 1.47 1.66 1.88 2.06 2.18 2.30 2.36 1.98 2.12 1.30 1.47 1.66 1.40 1.59 3.75 1.34 3.44 1.54 1.65 0.43 0.48 8.44 0.96 0.92 9.44 0.47 8.13 8.13 0.13 8.13 0.13 0.125 0.12 0.115 0.09 0.09 0.13 0.13 0.13 0.10 0.10 0.10 0.07 0.07 0.07 0.87 8.11 8.13 8.13 8.10 0.00 8.00 0.05-0.16 0.07 Assuming that competition drives down profitability (on existing assets as well as new investment) to 12.5% in year 6,12% in year 7 11.5% in year 8 and 9% in year 9 and all later years. What is the value of the concatenator business? (Do not round intermediate calculations. Enter your answer in millions rounded to 2 decimal places) milion Present value

Consider the table given below to answer the following question. The long run growth rate is projected at 7% and discount rate is 10% Year Asset value Earnings Net invest Free cash flow (FCF) Return on equity (ROE) Asset growth rate Earnings growth rate 10.00 11.30 12.77 14.43 15.87 17.46 19.20 20.55 21.99 23.53 1.30 1.47 1.66 1.88 2.06 2.18 2.30 2.36 1.98 2.12 1.30 1.47 1.66 1.40 1.59 3.75 1.34 3.44 1.54 1.65 0.43 0.48 8.44 0.96 0.92 9.44 0.47 8.13 8.13 0.13 8.13 0.13 0.125 0.12 0.115 0.09 0.09 0.13 0.13 0.13 0.10 0.10 0.10 0.07 0.07 0.07 0.87 8.11 8.13 8.13 8.10 0.00 8.00 0.05-0.16 0.07 Assuming that competition drives down profitability (on existing assets as well as new investment) to 12.5% in year 6,12% in year 7 11.5% in year 8 and 9% in year 9 and all later years. What is the value of the concatenator business? (Do not round intermediate calculations. Enter your answer in millions rounded to 2 decimal places) milion Present value

Corporate Fin Focused Approach

5th Edition

ISBN:9781285660516

Author:EHRHARDT

Publisher:EHRHARDT

Chapter7: Valuation Of Stocks And Corporations

Section7.6: Valuing Nonconstant Growth Stocks

Problem 3ST

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