You have performed a corporate valuation on Juniper Co. and estimate that the intrinsic value per share of Juniper is $38. However, the actual market price per share of the companys common stock is $27. In your analysis you assumed that after year 4, Junipers free cash flow would grow at a constant rate of g. Which of the following is the most likely reason that your intrinsic value estimate is greater than the market price?

a. Your estimate of the weighted average cost of capital is higher than the markets estimate.

b. Your estimates of Junipers year 1 through 4 free cash flows are lower than the markets estimates.

c. Your estimate of g, the growth rate of free cash flow after year 4, is higher than the markets expectation of g.

d. You believe that Juniper is riskier than the market does. e. both a and d