Arya Manufacturing has projected sales of $122 million next year. Costs are expected to be $72.4 million, and net investment is expected to be $14.3 million. Each of these values is expected to grow at 15 percent the following year, with the growth rate declining by 2 percent per year until the growth rate reaches 7 percent, where it is expected to remain indefinitely. There are 6.1 million shares of stock outstanding and investors require a return of 13 percent on the companys stock. The corporate tax rate is 24 percent.

a-What is your estimate of the current stock price?

b-Suppose instead that you estimate the terminal value of the company using a PE multiple. The industry PE multiple is 13. What is your new estimate of the companys stock price?

Note: For all requirements, do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.