What if my growth rate (NOPLAT and free cash flow), g, is greater than WACC when valuing a company? Assume that cash flow is positive. Or worse, assume it is negative.

Respuesta :

Well, it's really hard to say.

But let say that if your growth rate is greater that your WAAC at company valuation, it could indicate that you are increasing the dividend at the faster rate than the growth of the company, which could potentially make you go bankrupt

hope this helps