4. A company plans to pay no dividends in the next 3 years because it needs...

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4. A company plans to pay no dividends in the next 3 years because it needs earnings to finance new investment projects. The firm will pay a $5.00 per share dividend in year 4 and will increase the dividend by 30 percent per year for the next 3 years (i.e., year 5 to year 7). After that the company will maintain a constant dividend growth rate of 6 percent per year forever. The required return on the stock is 14 percent per year. Assume that dividends are paid annually. Find the current stock price. 4. A company plans to pay no dividends in the next 3 years because it needs earnings to finance new investment projects. The firm will pay a $5.00 per share dividend in year 4 and will increase the dividend by 30 percent per year for the next 3 years (i.e., year 5 to year 7). After that the company will maintain a constant dividend growth rate of 6 percent per year forever. The required return on the stock is 14 percent per year. Assume that dividends are paid annually. Find the current stock price.