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A company currently pays a dividend of $2 per share. It is estimated that the companys dividend will grow at a rate of 10 percent
- A company currently pays a dividend of $2 per share. It is estimated that the companys dividend will grow at a rate of 10 percent per year for the next 3 years, then the dividend will grow at a constant rate of 7 percent thereafter. The companys stock has a beta equal to 1.2, the risk-free rate is 7.5 percent, and the market risk premium is 4 percent. What would you estimate is the stocks current price?
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