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A share of Santhanakrishnan Corp. stock is expected to pay a $2.50 dividend one year from now. (I.e., Div1 is expected to be $2.50.) Dividends
A share of Santhanakrishnan Corp. stock is expected to pay a $2.50 dividend one year from now. (I.e., Div1 is expected to be $2.50.) Dividends are forecasted to then grow by 20.00%/year for four years. After the super-normal, 20.00% growth phase, dividends are thereafter expected to grow by 6.00%/year forever. Use a required rate of return of 14.00%/year and calculate a fair price for a share of this stock today.
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