9-19 CORPORATE VALUATION Brandtly Industries invests a large sum of money in R&D; as a result, it retains and reinvests all of its earnings. In other words, Brandtly does not pay any dividends, and it has no plans to pay dividends in the near future. A major pension fund is interested in purchasing Brandtly's stock. The pension fund manager has estimated Brandtly's free cash flows for the next 4 years as follows: $3 million, $6 million, $8 million, and $16 million. After the fourth year, free cash flow is projected to grow at a constant 3%. Brandtly's WACC is 9%, the market value of its debt and preferred stock totals $75 million; and it has 7.5 million shares of common stock outstanding. a. What is the present value of the free cash flows projected during the next 4 years? b. What is the firm's horizon, or continuing, value? c. What is the firm's total value today? d. What is an estimate of Brandtly's price per share