Consider a firm with expected free cash flows to the firm (FCFF) of $100 million in Year 1. For the next three years, we expect FCFF to grow at 10% per year. After this, the firm will experience stable growth of 2%. Assume the cost of capital is 14% and the firm has no debt. What is the value of the firm?

If the firm has no leverage and has 13 million shares outstanding, what is the share price?  

Basic Two-Stage Growth Valuation Model Inputs Year 1 FCFF ($M) Initial Growth Rate (g_ST) Terminal Growth Rate (g_LT) WACC Shares (M) Calculations Year Cash Flows Terminal Value Total CF PV Output Total PV Price per share 0 100 10% 2% 14% 13 1 2 3 st 4