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Author: Oforfive One star, 50 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 46814  
Subject: Valuation of growth company Date: 6/27/2013 5:31 AM
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I'm unsure of calculating present value of a growing company. Let's say we have a company earning.... $.70/share trailing twelve months. It is retail and growing (adding stores) at 18% per year, all out of FCF (earnings plus depreciation). Compounded growth at 18% is planned and reasonable for 8 years. Years 9 to 12 forecast expansion at that year 8 constant rate so at year 13 the expansion would be 9% and declining.

What P/E or price would you pay for a company like this today?

KC
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