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PLEASE INCLUDE THE STEPS CORPORATE VALUATION: Shome Industries retains and reinvests all its earnings. So, Shome does not pay any dividends, and it has no

PLEASE INCLUDE THE STEPS

CORPORATE VALUATION: Shome Industries retains and reinvests all its earnings. So, Shome does not pay any dividends, and it has no plans to pay dividends any time soon. A major pension fund is interested in purchasing Shomes stock. The pension fund manager has estimated Shomes free cash flows for the next 3 years as follows: $5 million, $9 million, and $12 million. After Year 3, free cash flow is projected to grow at a constant 4%. Shomes WACC is 10%, the market value of its debt and preferred stock totals $27.2727 million, Shome has $10 million in non-operating assets, and it has 5 million shares of common stock outstanding. What is an estimate of Shomes stock price?

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