The firms beta is 14 the risk-free rate of return is 26 and


You want to value a share based on its expected future dividend payments. Your analysis indicates that the last dividend paid by the firm was $3.25 per share. Dividends are expected to grow by 10% per year for the next four years, then settle back to a permanent growth rate of 4% per year. The firm's beta is 1.4, the risk-free rate of return is 2.6%, and the market risk premium is 6% per year. What is the stock's fair market value?

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Finance Basics: The firms beta is 14 the risk-free rate of return is 26 and
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