You Must Estimate the Intrinsic Value of Noe Technologies' Stock

question 88

Multiple Choice

You must estimate the intrinsic value of Noe Technologies' stock.The end-of-year free cash flow (FCF₁) is expected to be $23.50 million,and it is expected to grow at a constant rate of 7.0% a year thereafter.The company's WACC is 10.0%,it has $125.0 million of long-term debt plus preferred stock outstanding,and there are 15.0 million shares of common stock outstanding.Assume the firm has zero non-operating assets.What is the firm's estimated intrinsic value per share of common stock? Do not round intermediate calculations.

• A) $33.79
• B) $43.89
• C) $44.77
• D) $52.67
• E) $44.33

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Definitions:

Downsizing

Activities undertaken to improve organizational efficiency, productivity, and/or competitiveness that affect the size of the firm's workforce, its costs, and its work processes.

Laying Off Employees

The act of temporarily or permanently removing employees from their positions, often due to economic downturns or organizational restructuring.

HR Forecasting Process

The process used by organizations to estimate their future human resources needs based on current data and trends, ensuring they have the right number of employees with the right skills.

Staffing Needs

The identification and evaluation of requirements for current and future personnel to meet the organizational objectives.