·       An analyst forecasts to have expected dividends of $.75 one year from now for Turtle Company. The dividends are expected to grow at 12% per year thereafter until the fourth year. After the fourth year the dividends will grow at a constant rate of 2% per year. Equity Cost of Capital is 5% Re. Calculate the current stock price P0 using the Dividend Discount Model modified formula with (DivN+1/Re-G) on the end resulting in Pn Stock Price.

Answer rating: 100% (QA)

Youre right the Dividend Discount Model DDM can be used to estimate the current stock price of Turtl... View the full answer