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Looking for help with a Discounted Cash Flow Model on Johnson and Johnson. You should already have most of the necessary information, and what you
Looking for help with a Discounted Cash Flow Model on Johnson and Johnson.
You should already have most of the necessary information, and what you don't have is quickly available on Yahoo Finance under ticker JNJ. For this assignment please:
Choose a reasonable market premium
Calculate CAPM
Find a bond value for JNJ
Calculate WACC
Choose a reasonable forecast period
Determine a perpetuity growth percent
Forecast Free Cash Flows over the period chosen
Use the perpetuity growth chosen
Calculate the value of the business
Make some observation comparing your value to the market value
What might be the cause of difference?