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Bulldog Industries
An analyst seeks to determine the value of Bulldog Industries. After careful research, the analyst believes that free cash flows for the firm will be $80 million in 2004 and will grow at 10% for 2005 and 2006. The free cash flows will grow at a rate of 5% after 2006.
-The market value of Bulldog Industries debt and preferred stock is $934 million.If the firm has a weighted average cost of capital of 10%,find the equity value of the firm's stock.The firm has 50 million shares of stock outstanding.(assume that we are at January 1,2004…)
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