Aompany currently pays a dividend of 275 per share d0


Nonconstant Growth Valuation

A company currently pays a dividend of $2.75 per share (D0 = $2.75). It is estimated that the company's dividend will grow at a rate of 17% per year for the next 2 years, and then at a constant rate of 6% thereafter. The company's stock has a beta of 1.5, the risk-free rate is 7.5%, and the market risk premium is 3%. What is your estimate of the stock's current price? Round your answer to the nearest cent.

Request for Solution File

Ask an Expert for Answer!!
Financial Management: Aompany currently pays a dividend of 275 per share d0
Reference No:- TGS01410412

Expected delivery within 24 Hours