🔑 Core Terms from Lecture 11 Flashcards
1
Q
💸 FCFE (Free Cash Flow to Equity)
A
Money available to shareholders after operations, reinvestment, and debt payments.
2
Q
🏦 FCFF (Free Cash Flow to Firm)
A
Cash available to all capital providers (debt + equity), before interest.
3
Q
🧾 Equity Reinvestment
A
Total cash the firm puts back into the business from equity holders’ side
4
Q
📈 gFCFE (FCFE Growth Rate)
A
Expected future growth of FCFE, based on how much the firm reinvests.
5
Q
🧮 Terminal Value (TV)
A
The value of all future cash flows after the forecast period, usually in a one-stage model:
6
Q
📊 Cost of Equity (k)
A
The return shareholders expect.
7
Q
📊 WACC (Weighted Average Cost of Capital)
A
Blended return expected by all investors (debt + equity)
