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Excel Online Structured Activity: Corporate valuation Dantzler Corporation is a fast-growing supplier of office products. Analysts...

Excel Online Structured Activity: Corporate valuation Dantzler Corporation is a fast-growing supplier of office products. AnaCorporate valuation Dollars/shares in millions FCF FOF2 FCF Constant growth rate. WACC Market value of debt Common shares out

Excel Online Structured Activity: Corporate valuation 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 11%. 12 Year FCF ($ millions) - $8 $22 $35 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 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.) 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. million b. What is the firm's value today? 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. Do not round your intermediate calculations. $ million c. Suppose Dantzler has $33 million of debt and 22 million shares of stock outstanding. What is your estimate of the current price per share? Round your answer to two decimal places. Write out your answer completely. For example, 0.00025 million should be entered as 250.
Corporate valuation Dollars/shares in millions FCF FOF2 FCF Constant growth rate. WACC Market value of debt Common shares outstanding -$8.00 $22.00 $36.00 5.00% 11.00% $33.00 22 $36.00 3 FCFS 4 Horizon value Total FCFs 7 PV of FCFs to investors 9 Firm value today 1 Market value of equity, MV Equity 2 Price per share, Po Formulas -$8.00 $22.00 6 FCFS Horizon value Total FCFs $30.00 NA #NIJA WNIA =N/A PV of FCFs to investors #N/A ANA ΕΝΑ Firm value today #NIA Market value of equity, MV Equity Price per share, Po #N/A #N/A
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Answer #1

1.
=36*1.05/(11%-5%)=630

2.
=-8/1.11+22/1.11^2+36/1.11^3+36/1.11^3*1.05/(11%-5%)=497.621946270595

3.
=(-8/1.11+22/1.11^2+36/1.11^3+36/1.11^3*1.05/(11%-5%)-33)/22=21.1191793759361

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