Question - General Mills (NYSE: GIS) is a large manufacturer and distributor of package consumer food products. Benoit Gagnon, a buy-side analyst covering General Mills, has studied the historical growth rates in sales, earnings, and dividends for GIS, and also has made projections of future growth rates. Gagnon expects the current dividend of 1.10 per share to grow at 6 percent for the next two years, and that the growth rate will decline to 3 percent and remain at that level thereafter. The risk-free rate is 4%, the market risk premium is 6%, and GIS's beta, assumed to be 0.50.
Compute the value of one share of GIS stock using Dividends Valuation Approach.