b. At February 2, 2015, HD's NFL was $15,474 million. What was HD's operating value (Voper) at February 2, 2015? Assuming the market had perfect foresight of HD's future FCF for FY 2015-2018, what is the implied growth rate the continuing value (CV) at February 2, 2015? HD's weighted-average cost of capital (WACC) was 8 percent. The FCF (in $ millions) for FY 2015-2018 were C. d. FY 2015 $6,489 FY 2016 $7,777 FY 2017 $9,138 FY 2018 $10,463 What is the benefit to the analyst in estimating the implied growth rate for the FCF CV?
b. At February 2, 2015, HD's NFL was $15,474 million. What was HD's operating value (Voper) at February 2, 2015? Assuming the market had perfect foresight of HD's future FCF for FY 2015-2018, what is the implied growth rate the continuing value (CV) at February 2, 2015? HD's weighted-average cost of capital (WACC) was 8 percent. The FCF (in $ millions) for FY 2015-2018 were C. d. FY 2015 $6,489 FY 2016 $7,777 FY 2017 $9,138 FY 2018 $10,463 What is the benefit to the analyst in estimating the implied growth rate for the FCF CV?
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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Question
Please solve b, c and d part
Transcribed Image Text:On February 2, 2015, the end of Home Depot's (HD) 2014 fiscal year (FY), HD's share price was
$104.42.
E10.17
With 1,307 million shares outstanding, what was HD's market capitalization at February
2, 2015?
a.
At February 2, 2015, HD's NFL was $15,474 million. What was HD's operating value
(VOper) at February 2, 2015?
c. Assuming the market had perfect foresight of HD's future FCF for FY 2015–2018,
what is the implied growth rate the continuing value (CV) at February 2, 2015? HD’s
weighted-average cost of capital ("WACC) was 8 percent. The FCF (in $ millions) for FY
2015-2018 were
b.
FY 2015
FY 2016
FY 2017
FY 2018
$6,489
$7,777
$9,138
$10,463
d.
What is the benefit to the analyst in estimating the implied growth rate for the FCF CV?
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