Project 2 Week 7
Complete theÂ Problem 13-10 somatic Valuation on pages 551-552 in a Word schedule named FI515_W7_Project_yourname. Show the details of your calculation/work in your practice to the Problem.
The financial statements of Lioi Steel Fabricators are shown underâ"both the actual results for 2010 and the projections for 2011. Free property flow is expect to grow at a 6% rate after 2011. The weighted average cost of capital is 11%.
* a.Â If run capital as of 12/31/2010 is $502.2 million, what is the free cash flow for 12/31/2011?
* b.Â What is the horizon value as of 12/31/2011?
* c.Â What is the value of operations as of 12/31/2010?
* d.Â What is the total value of the company as of 12/31/2010?
* e.Â What is the intrinsic price per share for 12/31/2010?
Income Statements for the Year Ending December 31 (Millions of Dollars Except for Per office Data)
Actual 2010| project 2011|
Net sales| $ 500.0| $ 530.0|
Costs (except depreciation)| 360.0| 381.6|
dispraise| Â Â Â Â 37.5| Â Â Â Â 39.8|
Â Â Â Total operating costs| $ 397.5| $ 421.4|
Earnings in the beginning invade and taxes| $ 102.5| $ 108.6|
Â Â Â Less interest| Â Â Â Â 13.9| Â Â Â Â 16.0|
Earnings before taxes| $Â Â 88.6| $Â Â 92.6|
Â Â Â Taxes (40%)| Â Â Â Â Â 35.4| Â Â Â Â Â 37.
Net income before preferred dividends| $Â Â 53.2| $Â Â 55.6|
Â Â Â Preferred dividends| Â Â Â Â Â Â 6.0| Â Â Â Â Â Â 7.4|
Net income available for common dividends| $Â Â 47.2| $Â Â 48.2|
commonalty dividends| $Â Â 40.8| $Â Â 29.7|
Addition to retained earnings| $Â Â Â Â 6.4| $Â Â 18.5|
Number of shares| 10| 10|
Dividends per share| $Â Â 4.08| $Â Â 2.97|
Balance Sheets for December 31 (Millions of Dollars)
Â | Actual 2010| Projected 2011|
Assets| Â | Â | | |
Cash| $Â Â Â Â 5.3| $Â Â Â Â 5.6| | |
Marketable securities| 49.9| 51.9| | |
Accounts receivable| 53.0| 56.2| | |
Inventories| Â Â Â 106.0| Â Â Â 112.4| | |...If you want to get a full essay, order it on our website: Orderessay
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