5. In practice, a common way to value a stock of dividend-paying firm is to value the dividends over the next 5 years or so and then find a terminal stock price using a benchmark PE ratio.

Assume XYZ Co. just paid a dividend of $1.36/share, which is expected to grow 16% per year over the next five years. In five years, the estimated payout ratio is 40% and the expected PE ratio is 21. (Recall a firms payout ratio = per share dividend / EPS). Assuming XYZ has a required return of 11%, what is its stock price today? (20 pts)

provide full work with formulas please. and excel work if needed.