1. Eli Lilly (LLY): The following table contains historical dividends and free cash flows for the company. Dividend Model: Calculate the growth in dividends and the average growth in dividends. Use this as your estimate of future dividend growth. Use 2020 dividend as D. Use 9% as your stockholder rate of return (r.) estimate. Calculate the value of the stock. Calculate the value of the stock using a 6% growth rate instead of the historical average. FCF Model: Calculate the TVM growth rate. You will use this number as your g assumption. Use a discount rate of 6.5%. Use the average of all FCFs as your FCF. The debt for this company is $17,549.5 and the number of shares is 909M. Find the value of one share of stock. Calculate rs = (D1/PO) +g: The current stock price is $180.71. Use this stock price to calculate your expected rate of return using the dividend model assumptions. CAPM Model: The stock beta is.28. Use beta to calculate the rate of return. Assume the risk free rate is 1% and the market risk premium (rm-rf) is 7%. LLY 2015 2016 2017 2018 2019 2020 DN 2.00 2.04 2.08 2.25 2.58 2.96 2975 M 2967 M 2260 M 691 M 5120 M 3788 M