Valuation

# Valuation - Valuation DCF Model Steps 1 Calculate FCF 1...

This preview shows pages 1–3. Sign up to view the full content.

Valuation DCF Model Steps: 1. Calculate FCF: 1) NOPAT 2) Net operating working capital 3)Total net operating capital 4)Net investment in operating capital 2. Calculate the value of operations: sum of discounted cash flows 3. Add non-operating assets Non-constant growth model for years 2012-2014: Step 1: Calculate FCF 2012 2013 2014 1. Net operating working capital \$31 311,00 \$34 917,00 \$42 208,00 2. Net plant and equipment 9 660,00 10 224,00 11 007,00 3. Net operating capital \$40 971,00 \$45 141,00 \$53 215,00 4. Investment in operating capital \$4 221,00 4 170,00 8 074,00 5. NOPAT \$9 960,20 \$9 829,28 \$10 689,63 6. Less: Investment in op. capital \$4 221,00 4 170,00 8 074,00 7. Free cash flow \$5 739,20 \$5 659,28 \$2 615,63 Step 2: Calculate the value of operations Actual 2012 2013 2014 Long-term growth rate 5% Weighted Avg. Cost of Cap. (WACC) 9,64% Free Cash Flow \$5 659,28 \$2 615,63 Step 3. Discount and sum up FCFs Find the total value of the firm. Value of operations \$52 247,33

This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document
Plus: Value of nonoperating assets
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}

### What students are saying

• As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

Kiran Temple University Fox School of Business ‘17, Course Hero Intern

• I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

Dana University of Pennsylvania ‘17, Course Hero Intern

• The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

Jill Tulane University ‘16, Course Hero Intern