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Firm Z just generated $58 million in free cash flow last year, and is expected to grow at a constant 4.8% per year. The cost
Firm Z just generated $58 million in free cash flow last year, and is expected to grow at a constant 4.8% per year. The cost of debt for Firm Z is 5% and the cost of equity is 12%. The capital structure of Firm Z is 35% debt and 65% equity. The firm has $500 million in net debt, 100 million shares outstanding, and a corporate tax rate of 30%.
What is the intrinsic value of Firm Z's stock price?
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