The company is expected to generate Free Cash Flows of $200 million per year for the next three years. After that, FCFs are expected to grow at a constant rate of 5% per year into the foreseeable future. if the compnah has 30 million common stock outstanding and the sock currently sells for $95, is your view that the stock in undervalued or overvalued? Show all calculations to support your answer. Hint: Fins WACC.

Questions: 1) You are interested in finding the intrinsic value of a stock you'd like to include in your portfolio. The company only has common stock equity and one semi-annual coupon-paying bond issuance outstanding. You are given the following information: Market/Book ratio Book Value of Common Stock Equity 1.25 $350 million Book Value of Retained Earnings $500 million Semi-Annual Bond Market Value $1,150 (115%) $400 million Book Value of L-T Debt (Semi-Annual Bonds) Tax Rate Semi-Annual Bond Maturity Bond Coupon Rate 30% 15 years 5% per year CAPM's Beta Expected Return on the S&P 500 1.2 11% Risk-free Rate Dividend Payout Ratio 1% The company does not pay dividends and it is not expected to start paying dividends any time soon