I am looking for the correct answer to this financial accounting problem using valid accounting standards Falcon Corp.'s current market value ofequity is $72 million. It has 3 millionshares outstanding. The company's equitymultiplier is one, and it had sales of $105million last year. Its profit margin was6.8%. What is the firm's implied price-earnings ratio?

To find Falcon Corp.'s implied price-earnings (P/E) ratio, follow these steps: Step 1: Calculate Net…

Answered: Falcon Corp.'s current market value of…

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter3: Evaluation Of Financial Performance

Section: Chapter Questions

Problem 13P

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Suppose Alcatel-Lucent has an equity cost of capital of 9.2%, market capitalization of $10.95 billion, and an enterprise value of $15 billion. Suppose Alcatel-Lucent's debt cost of capital is 6.9% and its marginal tax rate is 38%. a. What is Alcatel-Lucent's WACC? b. If Alcatel-Lucent maintains a constant debt-equity ratio, what is the value of a project with average risk and the expected free cash flows as shown here,? c. If Alcatel-Lucent maintains its debt-equity ratio, what is the debt capacity of the project in part (b)? a. What is Alcatel-Lucent's WACC? Alcatel-Lucent's WACC is%. (Round to two decimal places.) Data table (Click on the following icon in order to copy its contents into a spreadsheet.) Year 0 1 FCF ($ million) - 100 50 Print C Done 2 99 3 66 X
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What is the its equity multiplier?

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Falcon Corp.'s current market value of equity is $72 million. It has 3 million shares outstanding. The company's equity multiplier is one, and it had sales of $105 million last year. Its profit margin was 6.8%. What is the firm's implied price- earnings ratio?