What will be the horizon value if there is no profit growth

Reference no: EM13692628

A company has the potential to earn $100M in the horizon year of a growth product that is expected to have a profit growth of 5% per year in perpetuity beyond the horizon year. If the company’s discount rate (WACC) is 12%,

Estimate the cash flow to be included in the horizon year.

What will be the horizon value if there is no profit growth?

Reference no: EM13692628

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