What is the equity value per share for a company with an FCFF of $9,000,000, debt of $25,000,000, and 8,000,000 shares of stock outstanding using the stable growth FCFF model?

To determine the equity value per share using the stable growth Free Cash Flow to the Firm (FCFF) model, we start by calculating the total value of the firm and then find the equity value based on the company's debt and the number of shares outstanding.

In the stable growth model, the total value of the firm is derived from the FCFF adjusted for a growth rate and discounted by the weighted average cost of capital (WACC). The basic formula is:

[ \text{Firm Value} = \frac{\text{FCFF}}{WACC - g} ]

Though the growth rate (g) and WACC are not provided, we can implicitly incorporate them into the valuation by considering the overall structure using the given values.

First, we start with the total firm value, which we'll denote as 'V'. If the firm has a debt of $25,000,000, then the equity value (E) can be expressed as follows:

[ E = V - \text{Debt} ]

Given an inital FCFF of $9,000,000, you can infer a firm value (V) could potentially be modeled against industry standards or existing metrics. You can estimate a normalized firm value for context, although this