Problem 9-19 Corporate valuation

Barrett Industries invests a large sum of money in R&D; as a result, it retains and reinvests all of its earnings. In other words, Barrett does not pay any dividends, and it has no plans to pay dividends in the near future. A major pension fund is interested in purchasing Barrett's stock. The pension fund manager has estimated Barrett's free cash flows for the next 4 years as follows: $3 million, $6 million, $9 million, and $15 million. After the fourth year, free cash flow is projected to grow at a constant 8%. Barrett's WACC is 13%, the market value of its debt and preferred stock totals $58 million, and it has 10 million shares of common stock outstanding.

What is the present value of the free cash flows projected during the next 4 years? Round your answer to the nearest cent. $

What is the firm's horizon, or continuing, value? Round your answer to the nearest cent. $

What is the firm's total value today? Round your answer to the nearest cent. $

What is an estimate of Barrett's price per share? Round your answer to the nearest cent.

$