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DEF currently produces annual free cash flow of 8 0 billion a year ( FCF 0 = $ 8 0 B ) . The company

DEF currently produces annual free cash flow of 80 billion a year (FCF0= $80B). The company has debt of $100 billion and Cash and Marketable Securities of $190 billion. The stock currently trades in the marketplace at $150 and that there are 17 billion shares outstanding, Assume that FCF is going to grow at 6% for the next 3 years as they introduce new products and that in year 4 and beyond the FCF will grow at 1%. What is the intrinsic value of the stock given this information? Assume at WACC of 8%.

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