Question

The WedLink Corporation just paid a dividend of $1.25 to its common shareholders, and announced that it expects the dividends to grow by 25% per year for the next 3 years, then drop to a growth rate of 16% for an additional 2 years, after which it expects the dividends to converge to the industry median growth rate of 8% per year. If investors are expecting 12% per year on WedLink’s stock, calculate the current stock price.



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  • CreatedMay 08, 2014
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