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ABC Co. recently paid a $1.15 dividend per share. This dividend is expected to grow by 30% for the next three years, and then grow
ABC Co. recently paid a $1.15 dividend per share. This dividend is expected to grow by 30% for the next three years, and then grow forever at a constant rate of 8%. Also, rs = 13.4%. What is its intrinsic (and current) stock price?
Draw the timeline and show all of your work to solve this problem.
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