Crisp cookwares common stock is expected to pay a dividend


Crisp cookwares common stock is expected to pay a dividend of $3 a share at the end of the year (D1 = $3.00) its beta is 0.8, the risk free rate is 5.2% and the market risk premium is 6%. The dividend is expected to grow at some constant rate g, and the stock currently sells for $4 a share. Assuming the market is in equilibrium what does the market believe will be the stocks price at the end of 3 years (i.e., what is P3?

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Financial Management: Crisp cookwares common stock is expected to pay a dividend
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