Page 1 of 1
XYZ Corp's most recet FCF was $48 million, the FCF is expected to grow at a constant rate of 6%. The firm's WACC is 12%
Posted: Tue Nov 23, 2021 8:51 am
by answerhappygod
- Xyz Corp S Most Recet Fcf Was 48 Million The Fcf Is Expected To Grow At A Constant Rate Of 6 The Firm S Wacc Is 12 1 (63.56 KiB) Viewed 66 times
XYZ Corp's most recet FCF was $48 million, the FCF is expected to grow at a constant rate of 6%. The firm's WACC is 12% and it has 15 million shares of common stock outstanding. The firm has $30 million in short term investments, which it plans to liquidate and distribute to common shareholders via a stock repurchase; the firm has no other non operating assets. It has $368 million in debt and $60 million in preferred stock. a. What is the firm's value of operations? b. Immediately prior to the repurchase, what is the intrinsic value of equity? c. Immediately prior to the repurchase, what is the intrinsic stock price? d. How many shares will remain after the repurchase? How many shares will be repurchased? e. Immediately after the repurchase, what is the intrinsic value of equity and stock price? Guidelines: Students are required to show all the calculations. They should be neatly categorized Case should be properly typed, printed and presented. No hand-written work. Deadline: Should be submitted as hard copy 24th, November, 2021, 12 pm