Kenneth Cole (K C P) had sales of $518 million in 2005. Suppose you expect its sales to grow at a 9% rate in 2006, but that this growth rate will slow by 1% per year to a long run growth rate for the apparel industry of 4% by 2011. Based on K C P s past profitability and investment needs, you expect E B I T to be 9% of sales, increases in net working capital requirements to be 10% of any increase in sales, and net investment (capital expenditures in excess of depreciation) to be 8% of any increase in sales. If K C P has $100 million in cash, $3 million in debt, 21 million shares outstanding, a tax rate of 37%, and WACC of 11%, what is your estimate of the value of KCP's stock in early 2006?

Can you solve this by using Excel?