Estimating Share Value Using the DCF Model
Following are forecasted sales, NOPAT, and NOA for AT&T for 2019 through 2022
Forecast the terminal period values assuming the following terminal period growth rate.
Assumption
Terminal period growth rate 2%
Reported Forecast Horizon Period
($ millions ) 2018 2019 2020 2021 2022 Terminal Period
Sales $173,318 $183,563 $194,423 $205,935 $218,138 $ -
NOPAT 23,457 24,644 25,969 27,374 28,862 -
NOA 371,601 393,493 416,949 441,813 468,169 -
Estimate the value of a share of AT&T common stock using the discounted cash flow (DCF) model as of December 31, 2018 using the following assumptions and the information above.