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Facebook doesnt pay dividends at the moment. The Corporate Valuation model is the most appropriate...

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Finance

Facebook doesnt pay dividends at the moment. The Corporate Valuation model is the most appropriate model to value Facebook. Heres Free Cash Flow projections (in billions of $) needed to value Facebook as a firm.

Year 1 FCF: 10.0

Year 2 FCF: 12.0

Year 3 FCF: 13.5

Year 4 FCF: 15.0

Year 5 FCF: 16.2

After year 5, Facebook free cash flow is expected to grow at a 5% constant growth rate in year 5 and beyond. Facebook WACC is 8%. Facebook has no debt or preferred stock and 2.4 billion shares of common stock outstanding? What is your valuation of Facebook common stock today?

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