Valeant Pharmaceuticals (VRX) has 187m shares outstanding, $26.7 billion in debt and $807m in cash. It projects free cash flows for next 2 years based on earnings forecasts below, a marginal tax rate of 24%, capital expenditures increasing from $175m in Year 1 to $190m by Year 2, and increases in net working capital (NWC) are based on a NWC-to-Sales ratio of 5% per year. Forecasts ($m) Year 0 Year 1 Year 2 Sales $10,287 $13,095 $14.117 Growth vs Prior Year 27.3% 7.8% Cost of Goods Sold ($3,274) ($3,529) Gross Profit $9.822 $10,588 Other Operating Expenses ($262) ($282) SG&A ($2,619) ($2,823) Depreciation ($171) ($171) EBIT $6.770 $7.311 (e) Determine VRX's free cash flow each year. (10 points) (f) Suppose VRX's free cash flow is expected to grow at 1% after Year 2. If VRX's weighted average cost of capital (WACC) is 16.7%, what is the value of VRX's stock? (10 points)