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4) (3 pts) You estimate Company B's Earnings per Share (EPS) over the next two years will be $2.00 next year and $2.80 the following
4) (3 pts) You estimate Company B's Earnings per Share (EPS) over the next two years will be $2.00 next year and $2.80 the following year. The company will pay out 30% of the earnings as dividends and you expect Company B will sell at a P/E multiple of 22 in two years. The required rate of return for this stock is 9.6%. What is your estimation of the Horizon Value or Price Target in 2 years (your estimate of what the stock will sell for in 2 years)? Horizon Value =$
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