A stock just paid an annual dividend of $4.88. The dividend is expected to grow by 12%
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Question:
A stock just paid an annual dividend of $4.88. The dividend is expected to grow by 12% per year for the next 5 years. It will then grow by 3% per year forever.
The required rate of return is 11%.
What is the dividend in year 5?
What is the terminal value (P5)
What is the value of the stock?
Related Book For
Corporate Finance A Focused Approach
ISBN: 978-1305637108
6th edition
Authors: Michael C. Ehrhardt, Eugene F. Brigham
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