A security analyst estimates the dividends over the next two years for Kennesaw Corp. to be $2.15 and $2.85, respectively. The analyst also expects that the Kennesaw Corp. dividend will stay constant at $2.85 forever after the second year. What is the price per share estimate if the required rate of return is 16%?

Question 28 options:

1)

$3.92

2)

$17.21

3)

$18.39

4)

$19.09