SOLUTION: A company currently pays a dividend of $2.25 per share (D0 = $2.25). It is estimated that the company's dividend will grow at a rate of 21% per year for the next 2 years, and then

Question 1149358: A company currently pays a dividend of $2.25 per share (D0 = $2.25). It is estimated that the company's dividend will grow at a rate of 21% per year for the next 2 years, and then at a constant rate of 8% thereafter. The company's stock has a beta of 2, the risk-free rate is 8%, and the market risk premium is 5%. What is your estimate of the stock's current price? Do not round intermediate calculations. Round your answer to the nearest cent.

Answer by ikleyn(52909) (Show Source): You can put this solution on YOUR website!
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This site and the forum are primarily intended to help School Students in Math.

It DOES NOT intended to serve requests deeply specialized in Finance.

So, do not waste your time posting such requests to this forum.

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