(Solution) - Dozier Corporation is a fast growing supplier of office products -(2025 Original AI-Free Solution)

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Academic Level: Undergrad. (yrs 3-4)

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Dozier Corporation is a fast-growing supplier of office products. Analysts project the following free cash flows (FCFs) during the next 3 years, after which FCF is expected to grow at a constant 7% rate. Dozier?s WACC is 13%.

a. What is Dozier?s terminal, or horizon, value?
b. What is the firm?s value today?
c. Suppose Dozier has $100 million of debt and 10 million shares of stock outstanding. What is your estimate of the current price pershare?