A stock just paid a dividend this morning of $1.39. Dividends are expected to grow at 11.00% for the next two years. After year 2, dividends are expected to grow at 7.64% for the following three years. At that point, dividends are expected to grow at a rate of 5.00% forever. 

If investors require a return of 15.00% to own the stock, what is its intrinsic value?

Answer rating: 100% (QA)

To calculate the intrinsic value of the stock we need to use the dividend discount model ... View the full answer