Question: Left Technologies (LT) has just developed a solar panel capable of generating 200% more electricity than any solar panel currently on the market. As a

Left Technologies (LT) has just developed a solar panel capable of generating 200% more electricity than any solar panel currently on the market. As a result, LT is expected to experience the following cash flows, $1 million in year 1, $3 million in year 2, $4 million in year 3, $5 million in year 4, and $6 million in year 5. After year 5, LT assumes the firm will be able to grow at 6% indefinitely. LT has calculated its weighted average cost of capital (WACC) to be 12%.

a. What is LTs value of operations today (t = 0)?

b. LT reports on its balance sheet $30 million in total debt, $6 million in short-term investments, and

$4 million in preferred stock. LT has 2 million shares outstanding.

What would be LTs estimate of its intrinsic stock price per share?

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