Assignment 29690

See details below: The company is AAPL or Apple
1. Using the facilities of ValuePro (http://www.valuepro.net) for the company that you have selected to study conduct a discounted cash flow valuation.
2. The analysis should explain each variable used in the analysis, why you accepted the given input, or how and why you changed a variable.
3. The analysis should also examine the relevant cash flows, compare the final valuation to the stock’s current price and explain any differences.(Note: Remember to adjust the equity risk premium to between 5% and 6%; also, adjust the growth rate to an appropriate long-term growth rate.)
Table 1
Assumptions for ValuePro.net Valuation
Company Name – Apple (AAPL)
ValuePro.netAssumptions
Your Assumptions
Explain the Reasoning for Your Assumptions

Excess Return Period (Years) (10 years is appropriate)
10
Revenues ($ mil) (From Income Statement)
169104
Growth Rate (%) (Estimated Annual Growth Rate in Earnings in Future)
14.5
Net Operating Profit Margin (%) (EBIT from Income Statement)
35.63
Tax Rate (%) (From Income Statement: Taxes / Earnings Before Taxes)
25.16
Stock Price ($) (Current Price per Share)
109.9
Shares of Stock Outstanding (mil.) (Be careful with decimal)
940.1
10 Yr. Treasury Bond Yield (%)
5
Bond Spread to Treasury (%) (1.5 is appropriate)
1.5
Preferred Stock Yield (%)
7.5
Depreciation Rate (%) (Percentage of Revenue; Calculate)
2.09
Investment Rate (%) (Percentage of Revenue for Capital Expenditures – Calculate)
5.3
Working Capital (%) (Percentage of Revenue – WC is Current Assets; Calculate)
-6.04
Short Term Assets ($ mil.) (Current Assets from Balance Sheet)
63337
Short-Term Liabilities ($ mil.) (Current Liabilities from Balance Sheet)
39913
Equity Risk Premium % (Should be between 5% and 6%)
3
Company Beta for Stock (Number) (Look up Beta)
1.05
Value (Book) of Debt Outstanding ($ mil.) (L-T S-T Debt from Balance Sheet)
0
Value Preferred Stock Outstanding ($ mil)
0
Company WACC (%) (Look up or Calculate)
8.15