You have been assigned the task of using the corporate, or free cash flow, model to estimate Universal Corporation's intrinsic value. The firm's WACC is 10.00%, its end-of- year free cash flow (FCF) is expected to be $70.0 million, the FCFs are expected to grow at a constant rate of 5.00% a year in the future, the company has $200 million of long- term debt and preferred stock, and it has 30 million shares of common stock outstanding. Assume the firm has zero non-operating assets. What is the firm's estimated intrinsic value per share of common stock? Show all work and discuss. There are three steps: 1. Calculate the dividend/cash flow each year using the growth rate 2. Determine where the growth of the company becomes constant (this is the key constant growth rate model), this is called the terminal or horizon value. 3. Place each of these cash flows (or dividends) into the calculator or excel using the interest rate given and calculate NPV which is called the intrinsic value