Essentials Of Investments
Essentials Of Investments
11th Edition
ISBN: 9781260013924
Author: Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher: Mcgraw-hill Education,
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The following table presents forecasted financial and other information for Scandinavian Furniture:
Projected EBIT
Earnings after tax
Free cash flow
Havasham's WACC
Expected growth rate in FCFs after 2014
Warranted MV firm/FCF in 2014
Warranted P/E in 2014
O $3,628 million
O $363 million
O $3,833 million
2012
$317
197
135
O $161 million
8.2%
4.0%
What is an appropriate estimate of Scandinavian Furniture's terminal value as of the end of 2014, using the perpetual-growth
equation as your estimate?
19.4
18.7
2013
$339
210
144
2014
$363
225
155
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Transcribed Image Text:The following table presents forecasted financial and other information for Scandinavian Furniture: Projected EBIT Earnings after tax Free cash flow Havasham's WACC Expected growth rate in FCFs after 2014 Warranted MV firm/FCF in 2014 Warranted P/E in 2014 O $3,628 million O $363 million O $3,833 million 2012 $317 197 135 O $161 million 8.2% 4.0% What is an appropriate estimate of Scandinavian Furniture's terminal value as of the end of 2014, using the perpetual-growth equation as your estimate? 19.4 18.7 2013 $339 210 144 2014 $363 225 155
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