Schauffele is considering an acquisition of Varner, Inc., a privately-held firm that manufactures healthcare diagnostic equipment. Assume that the correct WACC to value the cash flows is 12.15%.

Varner just reported EBIT of $5,600,000. The CFO of Schauffele projects that Varner should see profits grow at 12% per year for the next two years, 8% per year for the following two years, and then 5% per year thereafter. The annual change in Net Working Capital Investment should be 4% of EBIT, while Capital Expenditures should be 8% of EBIT. Depreciation charges should be 5% of EBIT; the appropriate Tax Rate is 21%.

For the Terminal Value, you decide to use a Price/Sales multiple of 2.8 times. Year Four Sales are expected to be $28.2Million.

Varner has $16Million in long-term debt and 240,000 shares of outstanding stock. Rounded to dollars and cents, calculate the value that the CFO of Schauffele places on a share of Varner, Inc. stock.