Coastal Tech is preparing a valuation forecast. The company…
Coastal Tech is preparing a valuation forecast. The company expects free cash flow to be $1,800,000 one year from today, then increase to $2,100,000 in Year 2, $2,400,000 in Year 3, and $2,700,000 in Year 4. After Year 4, free cash flow is expected to grow at a constant rate of 3% per year forever. Coastal Tech’s weighted average cost of capital, or WACC, is 9%. What is Coastal Tech’s value of operations?
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