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Netscape - (20,783(54,294(96,099(140,284(172,278 Test for...

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Netscape Valuation Model - Deterministic Version Assumptions 1996 1997 1998 1999 Revenue growth rate 65% Terminal value growth rate 4.00% Cost of sales (% revenues) 10.40% R&D (% revenues) 36.80% Tax rate 34.00% Other operating expenses 0.80 0.65 0.55 0.45 Capital expenditure 0.45 0.40 0.30 0.20 Depreciation (% revenues) 5.50% ∆NWC 0.00% Beta 1.50 Riskless rate 6.71% Market risk premium 7.50% Cost of equity (CAPM) 17.96% Model 1995 actual Forecast Revenues 33250 54863 90523 149363 246449 Cost of goods sold 3472 5706 9414 15534 25631 R&D expenses 12230 20189 33313 54966 90693 Depreciation 1836 3017 4979 8215 13555 Other operating expenses 26898 43890 58840 82150 110902 Profit before taxes (11186) (17940) (16023) (11501) 5668 Taxes (3803) (6100) (5448) (3910) 1927 Net income (7383) (11840) (10575) (7591) 3741 Capital expenditure 15236 24688 36209 44809 49290 ∆NWC 0 0 0 0 0 Free cash flow (20783) (33511) (41805) (44185) (31994) Terminal value (2005) 5008313 PV Free cash flow 243196 PV Terminal value 813971 Total PV 1057167 Cumulative FCF
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Unformatted text preview: (20,783) (54,294) (96,099) (140,284) (172,278) Test for positive FCF 2000 2001 2002 2003 2004 2005 Performance Total NPV Ratio TV/Total Year FCF >0 Max loss Price/Share 0.35 0.25 0.20 0.20 0.20 0.20 0.10 0.10 0.10 0.10 0.10 0.10 Shares 406641 670958 1107081 1826683 3014027 4973145 outstanding 42291 69780 115136 189975 313459 517207 to be issued 149644 246913 407406 672219 1109162 1830117 total 22365 36903 60889 100468 165771 273523 142324 167739 221416 365337 602805 994629 50017 149624 302233 498684 822829 1357668 17006 50872 102759 169553 279762 461607 33011 98752 199474 329132 543067 896061 40664 67096 110708 182668 301403 497314 0 0 0 0 0 0 14712 68558 149655 246931 407436 672270 (157,566) (89,007) 60,648 307,579 715,015 1,387,285 60648 307579 715015 1387285 60648 2002 1,057,167 0.77 2002 (172,278) 27.82 33000 5000 38000...
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