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A stock just paid a dividend this morning of $1.26. Dividends are expected to grow at...

A stock just paid a dividend this morning of $1.26. Dividends are expected to grow at 15.00% for the next two years. After year 2, dividends are expected to grow at 8.97% for the following three years. At that point, dividends are expected to grow at a rate of 4.00% forever. If investors require a return of 14.00% to own the stock, what is its intrinsic value?

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Answer #1

Dividend in Year 1 => 1.26(1+0.15) Year 2» 1026(1+o.rs) ² Dividend in lead 3 10666(lt 0.0897) Dividend 4 = 1.666(lt 0.08PLEASE DON’T FORGET TO GIVE A THUMBS UP ??!!!

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