1. An analyst is trying to value KLs stock. The analyst has collected data from the company and other sources to prepare the below financials, both actual and projected. Based upon these sources, the analyst expects the companys free cash flows to grow at 8% in 2019, 6% in 2020, and at 4% on average thereafter. The analyst has estimated the companys cost of capital to be 12.01%. Given this and the below information, what is the value of the firm? What is a reasonable estimate of its appropriate share price today assuming that there are 10,000,000 shares issued and outstanding?

Income statement for the fiscal year ending January 1 (Millions of dollars)

2017 (Actual)		2018 (Projected)
Net Sales	$400.0		$430.0
Costs	260.0		283.5
Depreciation	37.5		42.5
Earnings before interest and taxes	102.5		104.0
Interest expense	14.1		16.0
Earnings before taxes	88.4		89.9
Taxes (40%)	35.36		35.2
Net income before preferred dividends	53.04		52.8
Preferred dividends	6.0		6.5
Net income	47.04		46.3
Common dividends	37.632		38.2
Addition to retained earnings	9.0408		8.1

Balance sheets for the fiscal year ending January 1 (Millions of dollars)

2017 (Actual)		2018 (Projected)
Cash	$6.3		$6.6
Marketable Securities	40.9		37.128
Accounts Receivable	62.0		66.0
Inventories	107.0		115.5
Net plant & equipment	391.0		415.36
Total Assets	607.2		640.58
Accounts payable	9.6		12.1
Accruals	25.5		29.1
Long-term bonds	210.7		227.78
Preferred Stock	55		57.1
Common Stock (Par plus PIC)	160.0		160.0
Retained earnings	146.4		154.5
Total Liabilities & Equity	607.2		640.58