# fcffneg - A General FCFF Valuation Model An n-stage Model...

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General FCFF Discount Model Page  A General FCFF Valuation Model An n-stage Model This model is designed to value a firm, with changing margins, revenue growth, and other parameters. Assumptions 1. The firm is expected to grow at a higher growth rate in the first period. 2. The growth rate wil drop at the end of the first period to the stable growth rate. 3. The free cashflow to equity is the cor ect measure of expected cashflows to stockholders. The user has to define the fol owing 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 capital. (Cost of equity, Cost of debt, Weights on debt and equity) Inputs to the model Cur ent EBIT = (\$1,396.00) (in cur ency) Cur ent Net Income = (\$1,667.00) (in cur ency) Cur ent Dividends = \$0.00 ( in cur ency) Cur ent Interest Expense = \$390.00 (in cur ency) Cur ent Capital Spending \$4,289.00 (in cur ency) Cur ent Depreciation = \$1,381.00 (in cur ency) Tax Rate on Income = 35.00% (in percent) Cur ent Revenues = \$3,789.00 ( in cur ency) Cur ent Working Capital = (\$110.50) (in cur ency) Chg. Working Capital = (\$63.00) (in cur ency) Cash and Non-operating assets = \$1,477.00 Book Value of Debt = \$7,271.00 ( in cur ency) Book Value of Equity = \$15,807.00 (in cur ency) NOL car ied forward = \$2,075.00 Weights on Debt and Equity Is the firm publicly traded ? Yes ( Yes or No) If yes, enter the market price per share = \$12.57 (in cur ency) & Number of shares outstanding = 886.47 (in #) \$7,271.00 ( in cur ency) If no, do you want to use the book value debt ratio ? (Yes or No) If no, enter the debt to capital ratio to be used = (in percent) Enter length of extraordinary growth period = 10 (in years) Costs of Components Do you want to enter cost of equity directly? No (Yes or No) If yes, enter the cost of equity =

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fcffneg - A General FCFF Valuation Model An n-stage Model...

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