An analyst following Barlow Energy has compiled the following information in preparation for additional analysis she has to include in a report she has been asked to produce (data is in hundreds of millions of $): Before-Tax Required Security Type Preferred stock Bonds Common stock Total Market Value $200 $800 $600 $1,600 Bonds are trading at par Preferred share dividends: Net income available to common: Investment in working capital: • Investment in fixed capital: Net new borrowing: • Depreciation: • Tax rate: $2,560.47 $2,784.40 $2,964.08 $3,197.15 Return 10% 8% 13.0% $20 $135 $37 $94 $47 5% 4% $42 30% Long-term growth rate of FCFF: Long-term growth rate of FCFE: • WACC: 8.925% The total value of Barlow Energy using a single-stage FCFF model is closest to:
An analyst following Barlow Energy has compiled the following information in preparation for additional analysis she has to include in a report she has been asked to produce (data is in hundreds of millions of $): Before-Tax Required Security Type Preferred stock Bonds Common stock Total Market Value $200 $800 $600 $1,600 Bonds are trading at par Preferred share dividends: Net income available to common: Investment in working capital: • Investment in fixed capital: Net new borrowing: • Depreciation: • Tax rate: $2,560.47 $2,784.40 $2,964.08 $3,197.15 Return 10% 8% 13.0% $20 $135 $37 $94 $47 5% 4% $42 30% Long-term growth rate of FCFF: Long-term growth rate of FCFE: • WACC: 8.925% The total value of Barlow Energy using a single-stage FCFF model is closest to:
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Transcribed Image Text:An analyst following Barlow Energy has compiled the following information in preparation for additional analysis she
has to include in a report she has been asked to produce (data is in hundreds of millions of $):
Before-Tax Required
Market Value
Security Type
Preferred stock
Bonds
Common stock
Total:
●
$200
$800
$600
$1,600
Bonds are trading at par
Preferred share dividends:
Net income available to common:
• Investment in working capital:
• Investment in fixed capital:
Net new borrowing:
Depreciation:
• Tax rate:
Long-term growth rate of FCFF:
Long-term growth rate of FCFE:
• WACC:
$2,560.47
$2,784.40
$2,964.08
$3,197.15
Return.
10%
8%
13.0%
$20
$135
$37
$94
$47
5%
4%
$42
30%
8.925%
The total value of Barlow Energy using a single-stage FCFF model is closest to:
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