JenBritt Incorporated had a free cash flow (FCF) of $84 million in 2019. The firm projects FCF of $260 million in 2020 and $620 million in 2021. FCF is expected to grow at a constant rate of 6% in 2022 and thereafter. The weighted average cost of capital is 9%. What is the current (i.e., beginning of 2020) value of operations? Do not round intermediate calculations. Enter your answer in millions. For example, an answer of $1 million should be entered as 1, not 1,000,000. Round your answer to two decimal places.
JenBritt Incorporated had a free cash flow (FCF) of $84 million in 2019. The firm projects FCF of $260 million in 2020 and $620 million in 2021. FCF is expected to grow at a constant rate of 6% in 2022 and thereafter. The weighted average cost of capital is 9%. What is the current (i.e., beginning of 2020) value of operations? Do not round intermediate calculations. Enter your answer in millions. For example, an answer of $1 million should be entered as 1, not 1,000,000. Round your answer to two decimal places.
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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