Problem:
Penn Corporation does not currently pay dividends. It is expected to begin paying dividends in year two (D1) with a $2.50 dividend. This dividen is expected to grow at a rate of 14% for three years and then 6% every year after that forever. The required return on penn' stock is 16%.
Required:
Question: Caluclate the price of Penn's stock today.
Note: Please show guided help with steps and answer.