What would be the estimated intrinsic value per share

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Reference no: EM131925092

If the Ideal Corp. were to be expected to generate FCF of $50,000 in 2015, $175,000 in 2016, and $250,000 in 2017, and the FCF is expected to grow at a constant rate of 6% from that point forward, what would be the estimated intrinsic value per share for the company's stock at the end of 2014?

Ideal Corp. Balance Sheets

*Assets*	20136	20147
Cash	$ 9,000	$ 7,282
Short-term investments.	48,600	20,000
Accounts receivable	351,200	632,160
Inventories	715,200	1,287,360
total current assets	$ 1,124,000	$ 1,946,802
Gross fixed assets	491,000	1,202,950
Less: accumulated depreciation	146,200	263,160
net fixed assets	$ 344,800	$ 939,790
Total assets	$ 1,468,800	$ 2,886,592

*Liabilities and equity*	20136	20147
Accounts payable	$ 145,600	$ 324,000
Notes payable	200,000	720,000
Accruals	136,000	284,960
total current liabilities	$ 481,600	$ 1,328,960
Long-term debt	323,432	1,000,000
Common stock (100,000 shares)	460,000	460,000
Retained earnings	203,768	97,632
total equity	$ 663,768	$ 557,632
Total liabilities and equity	$ 1,468,800	$ 2,886,592

Income Statements

	20136	20147
Sales	$ 3,432,000	$ 5,834,400
Cost of goods sold	2,864,000	4,980,000
Other expenses	340,000	720,000
Depreciation	18,900	116,960
total operating costs	$ 3,222,900	$ 5,816,960
EBIT	$ 209,100	$ 17,440
Interest expense	62,500	176,000
EBT	$ 146,600	$ (158,560)
Taxes (40%)	58,640	(63,424)
Net income	$ 87,960	$ (95,136)

Other data	20136	20147
Stock price	$ 8.50	$ 6.00
Shares outstanding	100,000	100,000
EPS	$ 0.880	$ (0.951)
DPS	$ 0.220	$ 0.110

Reference no: EM131925092

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