A Company trading on London Stock Exchange has the following information as of the end of 2021. Net debt: 25 Tax rate: 20% Interest paid: 89 Interest received:82 Total assets: 300 Total liabilities: 210 Variance of returns on London Stock Exchange:0.6 The covariance of the companys stock returns with the returns of London Stock Exchange:0.98 Expected Market Return: 12% UK Government Bond Yield: 1.4% The companys actual Book Value and its forecasted earnings and dividends as well its actual and forecasted number of shares are given below. The expected growth in residual earnings is 1% per annum after 2025. 2021 A 2022 F 2023 F 2024 F 2025 F Earnings 85 90 282 240 Dividends 50 27 100 55 Book value 360 Number of shares 100 120 120 200 200 A=Actual; F=Forecasted a) Using the abnormal earnings model, estimate the value for each share of this company. b) Companys shares are traded at 4. As an analyst what would be your recommendation to investors about this company based on your abnormal earnings model analysis. Why? c) Another analyst approaches you and shows that by using the discounted free cash flows valuation model, she calculated a different value and thus has reached to a different recommendation than the one you reached in part (b) above. You check her calculations and conclude that they are correct, and her assumptions are sound. You are also confident about your calculations and assumptions. i. Would you change your recommendation in (b) according to this new recommendation? Why? Why not? ii. Would your answer have changed if the company in question had been a new start up with no positive cash flows forecasted in the short term? Why/Why not?.