Orange Phones, a leader in the development and manufacture of smart mobile phones, reported net income of $5 million in 2019. These earnings are expected to grow 10% a year for three years (2020 to 2022) and 3% a year after that. The firm reported depreciation of $1.5 million in 2019 and capital spending of $4 million and had 10 million shares outstanding. The working capital is expected to remain at 50% of revenues, which were $50 million in 2019, and are expected to grow 6% a year from 2020 to 2022 and 3% a year after that. The firm is expected to finance 10% of its capital expenditures and working capital needs with debt. Orange Phones had a beta of 1.40 in 2019, and this beta is expected to drop to 1.00 after 2022. (The treasury bond rate is 2%. The historical equity risk premium is 6%.)

1. (c)[4 marks] Estimate the value per share today, based upon the FCFE model.