8. Nonconstant growth stock As companies evolve, certain factors can dive sudden growth. This may lead to a period of nonconstant, or variable, arowth. This would cause the expected growth rate to increase or decrease, thereby affecting the valuation modet, for companies in such situations, you would fefer to the variable, or nonconstant, growth model for the valuation of the company's stock. Consider the case of Portman tndustries: Portman Industries just paid a dividend of $3.12 per share. The company expects the coming year to be very profitable, and its dividend is expected to grow by 12.00% over the not year. After the neat year, though, Portman's dividend is expected to orow at a constant rate of 2.40% per year, Assuming that the market is in equibbrium, use the information just given to complete the tabie: The risk-tree rate (rey) is 3.00\%, the market risk premium (RPM) is 3.60\%, and Portman's beta is 1.10 . What is the expected dividend vield for Portman's stock today? 3.65% 4,465 4.506