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Inputs

Enter your after-tax operating earnings (EBIT (1-t)) in your terminal year = 1035
Enter your free cashflow to firm in your terminal year = 750
Enter your perpetual growth rate= 4%
Enter your cost of capital in perpetuity = 9.35%

Output
Your reinvestment rate in perpetuity is = 27.54%
Your return on capital (equity) in perpetuity has to be = 14.53%

Just for your edification


If your return on capital = cost of capital, your reinvestment rate would be 42.78%
! If you are doing an equity valuation, enter the net income
! If you are doing an equity valuation, enter the FCFE

! If you are doing an equity valuation, enter the cost of equity

! With equity valuation, return on equity = cost of equity

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