Your objective is to assess financial data to project future cash flows, calculate their current value, estimate the company's worth at a future point, and determine the present value of both future cash flows and the company's future worth to establish its overall valuation.
Utilizing the provided financial statements including the Income Statement, Balance Sheet, and Cash Flow Statement of a company, your task involves projecting free cash flows, determining the Weighted Average Cost of Capital (WACC) to discount future cash flows to present value, calculating the terminal value, discounting both free cash flows and the terminal value to present value, and ultimately deriving the company's valuation. Also, make sure to answer the questions listed in the sheet and below.
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Forecasting Cash Flows: Initiate by projecting free cash flows. Develop revenue projections, a fixed assets schedule, and a net working capital projection to establish future cash flow estimates.
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Weighted Average Cost of Capital (WACC) Computation: Calculate the Weighted Average Cost of Capital (WACC) to discount all future cash flows back to their present value. This step is crucial for valuation.
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Terminal Value Determination: Compute the terminal value, representing the company's worth beyond the forecast period. This value is a critical component in the valuation process.
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Enterprise Value Calculation: Discount both the terminal value and the forecasted free cash flows to ascertain the enterprise value, using which calculate the valuation of the company.