It is expected that the dividend growth rate of Ryder Corporation will be 24% per year for 3 years. Ryder will maintain a constant dividend growth rate of 5.4% from year four on. Ryder paid a dividend of $6.4 per share last year. The company’s cost of equity is 15%. What is the terminal value of the stock at the end of year 3?

Answer rating: 100% (QA)

Heres how to calculate the terminal value of Ryder Corporations stock at the end of year 3 ... View the full answer