UBTECH Robotics is expected to generate the following free cashflows over the next five years. After which, the free cash flowsare expected to grow at the industry average of 3% per year. Usingthe discounted free cash flow model and the weighted average costof capital of 11%
UBTECH Robotics FCF Forecast ($ Millions) Year 1999, 2000, 2001,2002, 2003, 2004
FCF (Amount in Millions)$55, $45, $89, $102, $84, $87
a. Estimate the enterprise value (V0) of UBTECH Robotics.
b. If UBTECH Robotics has excess cash of $5.6 Billion, a debt of$800 Million and 50 Million shares outstanding, estimate its shareprice (P0).
