**Dantzler Corporation Financial Analysis Exercise**Dantzler Corporation is a fast-growing supplier of office products. Analysts project the following free cash flows (FCFs) during the next 3 years, after which FCF is expected to grow at a constant 7% rate. Dantzler’s Weighted Average Cost of Capital (WACC) is 11%.**Yearly Free Cash Flow (FCF in $ millions):**- Year 0: $0 (initial point)- Year 1: -$21- Year 2: $17- Year 3: $46**Questions:**a. **What is Dantzler's horizon, or continuing, value?** - **Hint:** Find the value of all free cash flows beyond Year 3, discounted back to Year 3. - Enter your answer in millions. For example, an answer of $13,550,000 should be entered as 13.55. Do not round intermediate calculations. Round your answer to two decimal places. - **Answer:** $________ millionb. **What is the firm's market value today?** - Assume that Dantzler has zero nonoperating assets. - Enter your answer in millions. For example, an answer of $13,550,000 should be entered as 13.55. Do not round intermediate calculations. Round your answer to two decimal places. - **Answer:** $________ millionc. **What is your estimate of the current price per share?** - Dantzler has $161.00 million of debt and 31 million shares of stock outstanding. - Write out your answer completely. For example, 0.00025 million should be entered as 250. Do not round intermediate calculations. Round your answer to the nearest cent. - **Answer:** $________**Graphical Representation:**The diagram shows a timeline from Year 0 to Year 3 with corresponding FCF values marked vertically:- Negative cash flow of $21 million in Year 1.- Positive cash flow of $17 million in Year 2.- Positive cash flow of $46 million in Year 3.

The weighted average cost of capital (WACC) is a method of calculating a firm's cost of capital in…

Dantzler Corporation is a fast-growing supplier of office products. Analysts project the following cash flows (FCFS) during the next 3 years, after which FCF is expected to grow at a constant 7% ate. Dantzler's WACC is 11%. Year 1 2

Dantzler Corporation is a fast-growing supplier of office products. Analysts project the following cash flows (FCFS) during the next 3 years, after which FCF is expected to grow at a constant 7% ate. Dantzler's WACC is 11%. Year 1 2

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

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Dantzler Corporation is a fast-growing supplier of office products. Analysts project the following free cash flows (FCFs) during the next 3 years, after which FCF is expected to grow at a constant 5% rate. Dantzler's WACC is 13%. Year 0 1 2 3 ....... ....... ....... ....... ....... ....... ....... ....... FCF ($ millions) ....... ....... ....... ....... ....... ....... ....... ...... - $9 $19 $49 The data has been collected in the Microsoft Excel Online file below. Open the spreadsheet and perform the required analysis to answer the questions below. Open spreadsheet What is Dantzler's horizon, or continuing, value? (Hint: Find the value of all free cash flows beyond Year 3 discounted back to Year 3.) Round your answer to two decimal places. Enter your answer in millions. For example, an answer of $13,550,000 should be entered as 13.55. $ fill in the blank 2 million What is the firm's value today? Round your answer to two decimal places. Enter your answer…

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