Calculating Enterprise Value All figures in USD thousands unless stated Levered free Cashflow Debt Unlevered Free Cash Flow Cash 8.75% 12.00% Year D 24,043 33,222 38,212 9,700 Year 1 Year 2 25,245 26,507 34,304 38,058 39,549 40,933 10,782 14,536 WACC Cost of Equity Given only the above information, what is the Enterprise Value at the end of Year 0? Assume end-of-year discounting. Year 3 27,832 43,234 42,366 Year 4 29,224 50,517 43,849 19,712 26,995 Year 5 30,685 55,480 45,383 31,958 Year 6 32,219 60,198 46,972 36,676

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
icon
Related questions
Question

A 165.

Subject:- finance 

Discounted Cash Flow Valuation - Calculating Enterprise Value
A discounted cash flow can be used to calculate either enterprise value or equity value.
Open the attached Excel file found above the question and go to the worksheet labeled: EV (Blank)
Calculate the company's enterprise value at the end of Year O given the information in the Excel file. Assume end-of-period-
discounting.
Calculating Enterprise Value
All figures in USD thousands unless stated
Levered free Cashflow
Debt
Unlevered Free Cash Flow
Cash
WACC
Cost of Equity
8.75%
12.00%
Year 0
24,043
33,222
38,212
9,700
Year 1
25,245
34,304
39,549
10,782
Year 2
26,507
38,058
40.933
14,536
Given only the above information, what is the Enterprise Value at the end of Year 0? Assume end-of-year discounting.
Year 3
27,832
43,234
42,366
19,712
Year 4
29,224
50,517
43.849
26,995
Year 5
30,685
55,480
45,383
31,958
Year 6
32,219
60,198
46,972
36,676
Transcribed Image Text:Discounted Cash Flow Valuation - Calculating Enterprise Value A discounted cash flow can be used to calculate either enterprise value or equity value. Open the attached Excel file found above the question and go to the worksheet labeled: EV (Blank) Calculate the company's enterprise value at the end of Year O given the information in the Excel file. Assume end-of-period- discounting. Calculating Enterprise Value All figures in USD thousands unless stated Levered free Cashflow Debt Unlevered Free Cash Flow Cash WACC Cost of Equity 8.75% 12.00% Year 0 24,043 33,222 38,212 9,700 Year 1 25,245 34,304 39,549 10,782 Year 2 26,507 38,058 40.933 14,536 Given only the above information, what is the Enterprise Value at the end of Year 0? Assume end-of-year discounting. Year 3 27,832 43,234 42,366 19,712 Year 4 29,224 50,517 43.849 26,995 Year 5 30,685 55,480 45,383 31,958 Year 6 32,219 60,198 46,972 36,676
Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 3 steps with 2 images

Blurred answer
Follow-up Questions
Read through expert solutions to related follow-up questions below.
Follow-up Question

The answer choices for this question are:

A) $151,854

B) $175,514

C) $155,290

D) $193,501

When calculating the enterprise value at the end of year 0, what calculation must be made in order to arrive at one of the four answers above?

Solution
Bartleby Expert
SEE SOLUTION
Recommended textbooks for you
Essentials Of Investments
Essentials Of Investments
Finance
ISBN:
9781260013924
Author:
Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:
Mcgraw-hill Education,
FUNDAMENTALS OF CORPORATE FINANCE
FUNDAMENTALS OF CORPORATE FINANCE
Finance
ISBN:
9781260013962
Author:
BREALEY
Publisher:
RENT MCG
Financial Management: Theory & Practice
Financial Management: Theory & Practice
Finance
ISBN:
9781337909730
Author:
Brigham
Publisher:
Cengage
Foundations Of Finance
Foundations Of Finance
Finance
ISBN:
9780134897264
Author:
KEOWN, Arthur J., Martin, John D., PETTY, J. William
Publisher:
Pearson,
Fundamentals of Financial Management (MindTap Cou…
Fundamentals of Financial Management (MindTap Cou…
Finance
ISBN:
9781337395250
Author:
Eugene F. Brigham, Joel F. Houston
Publisher:
Cengage Learning
Corporate Finance (The Mcgraw-hill/Irwin Series i…
Corporate Finance (The Mcgraw-hill/Irwin Series i…
Finance
ISBN:
9780077861759
Author:
Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor
Publisher:
McGraw-Hill Education