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You project a firm to have FCF in the next 3 years of $50m, $60m,...

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Finance

You project a firm to have FCF in the next 3 years of $50m, $60m, and 70m respectively, then tapering off to 4% growth per year forever. At a 10% discount rate, the present value of the firm's free cash flows is $1059M.

Using the information above, if the firm has $600M in debt and preferred stock, with 10m shares of stock outstanding, what is the value of a share of common stock?

$45.92/ share

$52.29/ share

$60/ share

$105.9/ share

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