Jumbo Shrimp Oxymorons, Inc. recently paid a dividend of $2.09 per share. The firm expects explosive growth of 20% over the next two years.
After that the firm's managers expect that growth will drop to 14% for the following three years, then settle at 8% indefinitely.
If investors require a rate of return of 15.10 on Jumbo's stock:
a. What will be the dividend paid out for the next six years?
b. What is its intrinsic value today?