Rexton oil is an all-equity firm with 200 million of shares, Ask an Expert

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Rexton Oil is an all-equity firm with 200 million of shares outstanding. Rexton currently has a cash flow of $270 Million of usds and expects future free cash flows of $60 millions per year. Management plans to use the cash to expand the firm's operations which will in turn increase future cash free cash flows to $90 million per year. If the cost of capital of Rexton's investments is 9%. (a). calculate the stock price for the company if the expansion where to happen.

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Financial Management, Finance

Category:- Financial Management
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