Estimating Share Value Using the DCF Model Following are forecasts of Target Corporation's sales, net operating profit after tax (NOPAT), and net operating assets (NOA) as of February 2, 2019, which we label fiscal year 2018. Note: Complete the entire question in Excel and format each answer to two decimal places. Then enter the answers into the provided spaces below with two decimal places. Reported Forecast Horizon Period Terminal millions 2018 Sales NOPAT NOA $76,006 3,269 23,670 2019 2020 2021 2022 $79,124 $83,730 $87,234 $92,246 4,052 3,572 4,401 3,939 24,197 26,057 26,677 28,661 Answer the following requirements with the following assumptions: Assumptions Terminal period growth rate 296 Period $93,428 4,667 28,571
Estimating Share Value Using the DCF Model Following are forecasts of Target Corporation's sales, net operating profit after tax (NOPAT), and net operating assets (NOA) as of February 2, 2019, which we label fiscal year 2018. Note: Complete the entire question in Excel and format each answer to two decimal places. Then enter the answers into the provided spaces below with two decimal places. Reported Forecast Horizon Period Terminal millions 2018 Sales NOPAT NOA $76,006 3,269 23,670 2019 2020 2021 2022 $79,124 $83,730 $87,234 $92,246 4,052 3,572 4,401 3,939 24,197 26,057 26,677 28,661 Answer the following requirements with the following assumptions: Assumptions Terminal period growth rate 296 Period $93,428 4,667 28,571
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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Se.132.
Transcribed Image Text:Estimating Share Value Using the DCF Model
Following are forecasts of Target Corporation's sales, net operating profit after tax (NOPAT), and net operating assets (NOA) as of February 2, 2019, which we label fiscal year 2018.
Note: Complete the entire question in Excel and format each answer to two decimal places. Then enter the answers into the provided spaces below with two decimal places.
Reported Forecast Horizon Period
Terminal
millions 2018
Sales
NOPAT
NOA
$76,006
3,269
23,670
2019
2020 2021 2022
$79,124 $83,730 $87,234 $92,246
4,052 3,572 4,401 3,939
24,197 26,057 26,677 28,661
Answer the following requirements with the following assumptions:
Assumptions
Terminal period growth rate
296
Discount rate (WACC)
7.63%
Common shares outstanding
517.80 million
Net nonoperating obligations (NNO) $12,373 million
Period
$93,428
4,667
28,571
Transcribed Image Text:Estimate the value of a share of Target common stock using the discounted cash flow (DCF) model as of February 2, 2019.
Terminal
Period
($ millions)
Reported
2018
Increase in NOA
FCFF (NOPAT - Increase in NOA)
Present value of horizon FCFF
Cum. present value of horizon FCFF $
Present value of terminal FCFF
Total firm value
NNO
Firm equity value
Shares outstanding (millions)
Stock price per share
$
$
0
0
0
0
0
0
0
$
2019
0 $
0
0
Forecast Horizon
2020
2021
0 $
0
0
0 $
0
0
2022
0 $
0
0
0
0
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