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Company A will have a free cash flows of $40 million next year, and its required rate of return is 11%. The company expected its

Company A will have a free cash flows of $40 million next year, and its required rate of return is 11%. The company expected its free cash flows to grow at a rate of approximately 4% per year forever, however the company CEO is somewhat unsure of the precise growth rate. The company has 10 million shares outstanding and 20 million in cash. If the company stock is currently trading at $55.53 per share, how would the CEO of the company update his beliefs about its growth?

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