- This topic has 1 reply, 2 voices, and was last updated 4 years ago by
.
Viewing 2 posts - 1 through 2 (of 2 total)
- Posts
sir is there an implied assumption that if the growth rate of FCF to Equity or FCF to firm is not mentioned then we have to calculate it using Revenue growth percentage?
No – unless the question were to tell you to assume that.
The free cash flow to the firm might grow at the same rate as the revenue growth (but there is no reason why it should). The free cash flow to equity is extremely unlikely to grow at the same rate because the interest payable is likely to be a fixed amount per year.
Again, it all depends on the wording of the question.
Viewing 2 posts - 1 through 2 (of 2 total)
- You must be logged in to reply to this topic.