A) Renfro Inc. is expected to have free cash flow (FCF) of $105 million next year and an expected constant growth rate of 5% thereafter. The weighted average cost of capital (WACC) for the company is 9.0%. Using the constant growth model, estimate the value of operations for Renfro Inc.

B)The most recent free cash flow (FCF) for Heath Inc. was $200 million, and the management expects the free cash flow to begin growing immediately at a 7% constant rate. The cost of capital is 12%. Using the constant growth model, determine the value of operations for Heath Inc.

C) Heath Inc. balance sheet shows that it has $10 million short-term investments, $15 million in notes payable, $60 million in long-term bonds, and $15 million in preferred stock. Heath has 60 million of shares outstanding. Calculate the following:

1. total intrinsic value for Heath Inc.
2. intrinsic value of equity for Heath Inc.
3. intrinsic stock price per share for Heath Inc.