Question: Please help with these 2 problems. I posted it before but answer given was wrong 1- A company had $19 of sales per share for

Please help with these 2 problems. I posted it before but answer given was wrong

1- A company had $19 of sales per share for the year that just ended. You expect the company to grow their sales at 6 percent for the next five years. After that, you expect the company to grow 4 percent in perpetuity. The company has a 14 percent ROE and you expect that to continue forever. The company's net margins are 6 percent and the cost of equity is 10 percent. Use the free cash flow to equity model to value this stock. Do not round intermediate calculations. Round your answer to the nearest cent.

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2- You are building a free cash flow to the firm model. You expect sales to grow from $1.2 billion for the year that just ended to $1.56 billion five years from now. Assume that the company will not become any more or less efficient in the future. Assume that the company will grow at a constant rate for 5 years, and then at a constant rate of 4.887395% for year 6 and onward after that. Use the following information to calculate the value of the equity on a per-share basis.

  1. Assume that the company currently has $432 million of net PP&E.
  2. The company currently has $144 million of net working capital.
  3. The company has operating margins of 12 percent and has an effective tax rate of 32 percent.
  4. The company has a weighted average cost of capital of 11 percent. This is based on a capital structure of two-thirds equity and one-third debt.
  5. The firm has 1 million shares outstanding.

Do not round intermediate calculations. Round your answer to the nearest cent.

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