Dubai Metro’s stock price was at $100 per share when it announced that it will cut its dividends for next year from $10 per share to $6 per share, with additional funds for the expansion of the Metro. Before the dividend cut, Dubai Metro expected it dividends to grow at a constant rate of 4%, but with the expansion, dividends are now expected to grow at a constant rate of 7%. Assume that the required rate of return remains the same after the change.
What would be the Metro’s stock price after the change?