LULULEMON ATHLETICA: PITCHING AN IPO
Please use the information only from the case and answer the following questions. Pleasejustify any assumptions you may use for the analysis.
1. If Lululemon were to issue $50 million worth of new common stock, what should be thesuggested price for the IPO? McDonald’s is expecting to employ the discounted cash flowusing FCFF assuming both the market risk premium and long-term growth rate is 5%.
2. What key opportunities and risks should be highlighted for investors in theproposed IPO?
Please see the attached case pdf as well as the excel file to answer the above questions.