Calculating the terminal value and value of operations
The Beatle Co. has never paid a dividend. FCF is projected to be $40,000 and $50,000 for the next two years, and after the second year it is expected to grow at a constant rate of 6%. The WACC is 11%.
1) What is the terminal or horizon, value of operations in millions?
a) $1
b) $1.06
c) $1.095
d) $2.0
None of the Above
2) What is the value of the Beatle Company operations?
a)936,936
b) 1,045,000
c) 932,000
d) 1,090,000
e) None of the Above