Rod’s is a maker of fishing rods and tackle. The company has forecast the following growth rates for the next 3 years: Year 1: 30%, Year 2:

25%, and Year 3: 20%. Thereafter, the company expects to continue to grow at a constant rate of 7% going forward. Last week, the company paid a dividend of $2.00 per share. If the required rate of market equity return for the company is 16%, estimate the market value of the share.

a. $51.03

b. $36.86

c. $56.12

d. $46.37