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Business, 15.11.2019 23:31 queenbee2994

You are valuing soda city inc. it has $104 million of debt, $89 million of cash, and 154 million shares outstanding. you estimate its cost of capital is 12.6%. you forecast that it will generate revenues of $703 million and $797 million over the next two years. projected operating profit margin is 21%, tax rate is 29%, reinvestment rate is 23%, and terminal exit value multiple at the end of year 2 is 15. what is your estimate of its share price? round to one decimal place. [hint: compute projected fcff for years 1 and 2 based on info provided, compute terminal value using the exit multiple method, discount it all to find ev, walk the bridge to equity, divide by number of shares outstanding.]

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