1. Fundamental valuation.

Financial analyst is evaluating XS Company by using the FCFF valuation approach. The analyst has collected the following information (currency in euro): XS has net income of 250 million, depreciation of 90 million, capital expenditures of 170 million, and an increase in working capital of 40 million. The resulting FCFF is expected to increase by 12% for the first four years. After the four years of high growth, the companys NOPAT is expected to grow by 3% a year indefinitely and XS is going to reinvest (incl. gross investment into capital assets and net working capital) 25% of its after-tax operating income (e.g. NOPAT). The current market value of XSs outstanding debt is 1,800 million. The company has also $200 million worth non-core liquid financial investments. The corporate tax rate is 30 percent. XS is financed with 40 percent debt and 60 percent equity. The before - tax cost of debt is 6% and the before - tax cost of equity is 13 percent. XS has 10 million outstanding shares.

Question: Estimate the value of the stock implied by the fundamentals