Given the 3 stages of a firm's life with respect to ROIC and WACC, in which stage is it most appropriate to value a firm's equity using the notion of equity as a call option on the value of the firm?

three stages are

A single-product company generally has three stages of value creation ROIC Invest in product development, marketing and distribution During the investment period, the company tends to destroy value (ROIC below WACC). Is this a problem? Not as long as future returns cover early losses! STAGE 1 Low STAGE 2 Launch product and establish competitive advantage Value is created by earning an ROIC greater than the cost of capital. To earn a superior ROIC, a company must be able to charge a price premium, lower cost per unit, or use its capital more efficiently than its competition. High Competitors respond and new companies enter market STAGE 3 Falling To keep competitors at bay, a company must have a sustainable advantage, such as patents or high switching costs. Otherwise, competitors will steal share by lowering price, causing ROIC to drop. A single-product company generally has three stages of value creation ROIC Invest in product development, marketing and distribution During the investment period, the company tends to destroy value (ROIC below WACC). Is this a problem? Not as long as future returns cover early losses! STAGE 1 Low STAGE 2 Launch product and establish competitive advantage Value is created by earning an ROIC greater than the cost of capital. To earn a superior ROIC, a company must be able to charge a price premium, lower cost per unit, or use its capital more efficiently than its competition. High Competitors respond and new companies enter market STAGE 3 Falling To keep competitors at bay, a company must have a sustainable advantage, such as patents or high switching costs. Otherwise, competitors will steal share by lowering price, causing ROIC to drop