14. Using the following information, please answer the questions about Surelock Homes, a startup company. In your analysis, assume the page 384 valuation date is the end of year 6, projected earnings in year 6 will be $12 million, and an appropriate price-to-earnings ratio for valuing these earnings is 20 times. Financing Round Amount in millions $6 8 1 2 3 12 Year 0 2 4 Required Return 60% 40% 30% In addition, the company wants to reserve 15 percent of the shares outstanding at time 6 for employee bonuses and options. a. What percentage ownership at time 0 should round 1 investors demand for their $6 million investment? b. If Surelock presently has 1 million shares outstanding, how many shares should round 1 investors demand at time 0? c. What is the implied price per share of Surelock stock at time 0?
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- 3) It is now Jan 1, 2016. You have analyzed DuckCo's future product launches, markets, and competitors. You project the following FCFs for the next 3 years: 2016 2017 5,600 6,700 ($ 000) FCF 2018 7,200 After 2018, you believe DuckCo's FCF will grow at 3% per year. DuckCo's beta is 1.1, the risk free rate is 4%, the expected market return is 12.6%, their capital structure consists of 80% equity and 20% net debt which has a debt yield of 5%. Their tax rate is 28%. They have $4 million in cash, $20 million in debt, and 3 million shares outstanding. What is your estimate of DuckCo's stock price?7. Assume that you have full year forecasted financials for 2019 - 2024 (planning period) and the following financials for after the planning period: • NOPAT (last year of planning period) = 90 • Long term growth rate = 2% • Long term ROCB = 11% • WACC = 8% What is the present value (at December 2018) of the terminal value of this company using the Key Value Driver Formula? Please round your answer to the nearest whole number and provide your answer in USD millions without a dollar sign (e.g. 100 instead of $100).Lipsion Ltd company is thinking about investing in one of two potential new productsfor sale. The projections are as follows: year revenue/ product s revenue/ product v0 (150,000) outlay (150000) outlay1 14000 150002 24000 253333 44000 520004 84000 63333 Calculate NPV of both products (to 1 d.p.) assuming a discount rate of 7%. Then decide which product should be selected and why ?
- Salalah Wind Energy has taken up a new project with an initial investment of 50000 OMR.The expected future cashflow from the project over the next three years will be 22500 OMR, 23500 OMR and 24500 OMR.What is the profitability index if the discount rate is 7 percent? Select one: O a. 1.48 O b. 1.23 O c. 1.44 O d. 1.63 O e. None of these3. After studying the Financial Forecast and planning, go through the assumption date given below and calculate how much Discretionary financing will we need in 2021 year? Suppose this year's sales will total $32 million. Next year, we forecast sales of $50 million. Net income should be 5% of sales. Dividends should be 50% of earnings. If this year's information's are as follows: This year % of $32m Assets Current Assets Fixed Assets $8m 25% $16m. 50% Total Assets $24m Liab, and Equity Accounts Payable Accrued Expenses Notes Payable Long Term Debt $4m 12.5% $4m 12.5% $1m nla $6m Total Liabilities $15m Common Stock Retained Earnings Equity Total Liab. & Equity $7m nla $2m $9m $24mYou solve present value problems on a financial calculator just like you do future value problems. For the example we just examined (the present value of $1,000 to be received in three years at 15 percent), you would do the following: Enter 3. 15 1,000 I/Y PMT PV FV Solve for -657.52 Notice that the answer has a negative sign; as we discussed earlier, that's because it represents an out- flow today in exchange for the $1,000 inflow later.
- Lipsion Ltd company is thinking about investing in one of two potential new productsfor sale. The projections are as follows: year revenue/ product s revenue/ product v0 (150,000) outlay (150000) outlay1 14000 150002 24000 253333 44000 520004 84000 63333 Calculate NPV of both products (to 1 d.p.) assuming a discount rate of 7%Finance Whadden National Bark is undertaking statec GAP analysis. In the one yoar time bucket, it holds $43 million in rate-sen income if interest rates are expected to change by 1.28%? . Round your final answer to the nearest dollar (Ex. $O) and submit decreases as a negative.Find the profitability index for Oman Air conditioner Company if the initial investment is 4000 OMR and the cash Inflows are as follows: Year 1 =1350 OMR; Year 2 =1400 OMR; Year 3=1450 OMR and Year 4=1500 OMR. Use discount rate as 5%. Select one: a. 1.69 b. 1.48 c. 1.26 d. 1.83 e. None of the options Find the Net Present Value (NPV) for Oman Computer company if the initial investment is 5000 OMR and the cash Inflows are as follows: Year 1 =1250 OMR; Year 2 =1500 OMR; Year 3=1750 OMR and Year 4=2000 OMR. Use discount rate as 3%. Select one: a. 1005.94 OMR b. 1574.27 OMR c. 2344.92 OMR d. None of the options e. 2070.76 OMR
- Find the profitability index for Oman Air conditioner Company if the initial investment is 4000 OMR and the cash Inflows are as follows: Year 1 =1350 OMR; Year 2 =1400 OMR; Year 3=1450 OMR and Year 4=1500 OMR. Use discount rate as 5%. Select one: O a. 1.48 O b. None of the options O c. 1.69 O d. 1.83 Oe. 1.26Find the profitability index for Oman Air conditioner Company if the initial investment is 4000 OMR and the cash Inflows are as follows: Year 1 =1350 OMR; Year 2 =1400 OMR; Year 3=1450 OMR and Year 4=1500 OMR. Use discount rate as 5%. Select one: a. 1.48 b. 1.26 c. None of the options d. 1.83 e. 1.69Your company is considering a capital project that will require a net initial investment of $244,978. The project is expected to have a 7- year life and will generate an annual net cash inflow of $40,860. Using the present value tables, what is the internal rate of return? (Round answers to O decimal places, e.g. 25.) Click here to view the factor table. Internal Rate of Return %