Retail fund manager Seymour Simms is considering the purchase of shares in upstart retailer Hot TopicStores (HTS). The current book value of HTS is $20 per share, and its market price is $35. Simmsexpects longterm ROE to be 18 percent, longterm growth to be 10 percent, and cost of equity to be 14percent. What conclusion would you expect Simms to arrive at if he uses a singlestage residual incomemodel to value these shares?