Professional Documents
Culture Documents
1 ($893.81) ($792.33)
2 ($832.48) ($654.18)
3 ($953.76) ($664.40)
4 ($1,036.78) ($640.23)
5 ($999.05) ($546.89)
6 ($728.08) ($355.43)
7 ($250.97) ($109.89)
8 ($344.40) ($136.02)
9 ($127.69) ($45.73)
10 $318.13 $60,899.33 $19,986.47
$16,041.34
ValuingOptionsorWarrantswhenthereisdilution
Enterthecurrentstockprice= $84.00
Enterthestrikepriceontheoption= 13.375
Entertheexpirationoftheoption= 8.4
Enterthestandarddeviationinstockprices= 50.00% (volatility)
Entertheannualizeddividendyieldonstock= 0.00%
Enterthetreasurybondrate= 6.50%
Enterthenumberofwarrants(options)outstanding= 38
Enterthenumberofsharesoutstanding= 340.79
VALUINGWARRANTSWHENTHEREISDILUTION
StockPrice= 84 #Warrantsissued= 38
StrikePrice= 13.375 #Sharesoutstanding= 341
AdjustedS(DONOTENTER)= Err:522 T.Bondrate= 6.50%
AdjustedK(DONOTENTER)= 13.375 Variance= 0.2500
Expiration(inyears)= 8.4 Annualizeddividendyield= 0.00%
Div.Adj.interestrate= 6.50%
d1= Err:522
N(d1)= Err:522
d2= Err:522
N(d2)= Err:522
Valueofthecall= Err:522
NumberofOptions= 38
ValueofOptions= Err:522
Value and Revenue Growth
120
100
80
60
40
20
0
41% 45% 50%
Value per Share and EBITDA Margins
80
70
60
50
30
20
10
0
6% 8% 10% 12% 14%
Revenue GrowValue per Share
41% 37.97
45% 61.43
50% 96.59
AGeneralFCFFValuationModel
AnnstageModel
Thismodelisdesignedtovalueafirm,withchangingmargins,revenuegrowth,
andotherparameters.
Assumptions
1.Thefirmisexpectedtogrowatahighergrowthrateinthefirstperiod.
2.Thegrowthratewilldropattheendofthefirstperiodtothestablegrowthrate.
3.Thefreecashflowtoequityisthecorrectmeasureofexpectedcashflowstostockholders.
Theuserhastodefinethefollowinginputs:
1.Lengthofhighgrowthperiod
2.Expectedgrowthrateinearningsduringthehighgrowthperiod.
3.CapitalSpending,DepreciationandWorkingCapitalneedsduringthehighgrowthperiod.
4.Expectedgrowthrateinearningsduringthestablegrowthperiod.
5.Inputsforthecostofcapital.(Costofequity,Costofdebt,Weightsondebtandequity)
Page
General FCFF Discount Model
Inputstothemodel
NOLcarriedforward= $1,500.00
WeightsonDebtandEquity
Ifnotpubliclytraded,doyouwanttousethebookvaluedebtratio? (YesorNo)
Ifno,enterthedebttocapitalratiotobeused= (inpercent)
Enterlengthofextraordinarygrowthperiod= 10 (inyears)
CostsofComponents
Doyouwanttoentercostofequitydirectly? No (YesorNo)
Ifno,entertheinputstothecostofequity
Betaofthestock= 1.6
Page
General FCFF Discount Model
EarningsInputs
Pleaseenteryearspecificinputsforeachofthefollowingvariables:
CompoundedAvg 43%
Ifyes,enterthebetaforstableperiod= 1.00
Page
General FCFF Discount Model
CapitalSpendingandDepreciationinStablegrowthperiod
Iscapitalspendingtobeoffsetbydepreciationinstableperiod? No (YesorNo)
Ifno,entercapitalexpendituresas%ofdepreciationinsteadystate: 110% (inpercent:>100%)
Page
General FCFF Discount Model
Outputfromtheprogram
CostofEquity= 12.90%
Equity/(Debt+Equity)= 98.80%
AftertaxCostofdebt= 5.20%
Debt/(Debt+Equity)= 1.20%
CostofCapital= 12.81%
1 2 3 4 5
Page
General FCFF Discount Model
Index 0 0 0 0 0
CostofCapitalComputation
TaxRate 0% 0% 0% 0% 0%
Beta 1.60 1.60 1.60 1.60 1.60
GrowthRateinStablePhase= 6.00%
FCFFinStablePhase= $2,256.32
CostofEquityinStablePhase= 10.50%
Equity/(Equity+Debt)= 85.00%
ATCostofDebtinStablePhase= 5.20%
Debt/(Equity+Debt)= 15.00%
CostofCapitalinStablePhase= 9.71%
Valueattheendofgrowthphase= $60,899.33
Page
General FCFF Discount Model
PresentValueofFCFFinhighgrowthphase= ($3,841.26)
PresentValueofTerminalValueofFirm= $19,882.60
Valueofthefirm= $16,041.34
MarketValueofDebt= $349.00
MarketValueofEquity= $15,692.34
ValueofOptionsOutstanding(Seeoptionworksheet)= Err:522
ValueofEquityinCommonStock= Err:522
ValueofEquityperShare= Err:522
Page
General FCFF Discount Model
el
ins,revenuegrowth,
Page
General FCFF Discount Model
Page
General FCFF Discount Model
cent:>100%)
Page
General FCFF Discount Model
6 7 8 9 10 TerminalYear
Page
General FCFF Discount Model
0 0 0 0 1
Page