fcfe2st - Two-Stage FCFE Discount Model This model is...

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 Two-Stage FCFE Discount Model Page  Two-Stage FCFE Discount Model This model is designed to value the equity in a firm, with two stages of period of higher growth and a subsequent period of stable g Assumptions 1. The firm is expected to grow at a higher growth rate in the first period. 2. The growth rate will drop at the end of the first period to the stable growth rate. 3. The free cashflow to equity is the correct measure of expected cashflows to stockholders. The user has to define the following inputs: 1. Length of high growth period 2. Expected growth rate in earnings during the high growth period. 3. Capital Spending, Depreciation and Working Capital needs during the high growth period. 4. Expected growth rate in earnings during the stable growth period. 5. Inputs for the cost of equity.
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 Two-Stage FCFE Discount Model Page  Inputs to the model Current Earnings per share = $4.00 (in currency) Current Dividends per share = $0.25 (in currency) Current Capital Spending/sh = $3.70 (in currency) Current Depreciation / share = $1.70 (in currency) Current Revenues/ share = $20.00 Working Capital/ share = $8.00 (in currency) Chg. Working Capital/share = $1.00 Enter length of extraordinary growth period = 5 (in years) Do you want to enter cost of equity directly? No (Yes or No) If yes, enter the cost of equity = (in percent) If no, enter the inputs to the cost of equity Beta of the stock = 1.3 Riskfree rate= 7.00% (in percent) Risk Premium= 5.50% (in percent) Earnings Inputs Do you want to use the historical growth rate? Yes (Yes or No) If yes, enter EPS from five years ago =
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fcfe2st - Two-Stage FCFE Discount Model This model is...

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