The terminal value is also pushed up, as a result of the higher growth in the high growth period:

Terminal value = FCFFn/(Cost of capital - g) = 6433 (1.04)/(.0716-.04) = $126,967 mil The value of the firm and the value per share can now be estimated: Present Value of FCFF in high growth phase = $16,254.91

+ Present Value of Terminal Value of Firm = $58,645.39

+ Value of Cash, Marketable Securities & Non-operating assets = $3,432.00

- Market Value of outstanding debt = $14,648.80

- Value of Equity in Options = $1,334.67 Value of Equity in Common Stock = $62,348.84 Market Value of Equity/share = $30.45

Disney's value per share increases from $11.14 per share in illustration 12.11 to $30.45 a share, when we make the changes to the way it is managed.36

Stocks and Shares Retirement Rescue

Stocks and Shares Retirement Rescue

Get All The Support And Guidance You Need To Be A Success At Investing In Stocks And Shares. This Book Is One Of The Most Valuable Resources In The World When It Comes To

Get My Free Ebook

Post a comment