Please answer the following question. Please write all your work and the equations used.

1. Tiara Wings Ltd is a firm that makes princess tiaras and chicken wings. The firm has projected its future growth in the table below. The firm has a required Return on Equity of 14.9%. The long-run growth rate after year 5 is 4%. The firms cost of debt is 5.55% and there are 865,000 shares of common stock outstanding that are trading at $16.77. The accounting statement is in thousands of dollars on the following pages. Assuming that the projections are correct and that there are no asset sales other than those at book value, compute the stock price per share using:

a) the WACC/FCF method

b) the Flow-to-Equity method

Develop a full pro forma statement to arrive at each answer. Include the full pro forma statement as part of your work!

Tiara \& Wings Unleveraged Projections