ABC is a company listed on the Stock Exchange. For the current

year the following information is given: Earnings per share $($E$0)$ is $1\mathrm{.}28,$ the dividend per

share $($M$0)$ that it just distributed is $0\mathrm{.}55,$ the percentage of profits that the company distributes as dividend expected to be $43\%$ for the next $5$ years, and the current stock price of the share is $20.$

For the next five years, it is estimated that ABC company will have a fairly high growth. THE

expected growth rate $($g$)$ of earnings and dividends during this period of high

growth has been estimated to amount to $15\mathrm{.}07\%$ per year. After the $5$th $($from the $6$th to the $10$th year$)$

year, the pace of earnings growth $($was estimated to have a continuous downward trend

and will gradually decrease as follows: g$6=12\mathrm{.}52\%,$ g$7=9\mathrm{.}7\%,$ g$8=8\mathrm{.}2\%,$ g$9=7\mathrm{.}02\%,$ g$10=6\mathrm{.}2\%.$

The percentage of earnings distributed by the company as dividend is expected to be $40\%$ from the $6$th year in perpetuity. After the $10$th year, the growth rate of earnings and dividends $($g$)$

estimated to remain constant at $3\mathrm{.}5\%$ in perpetuity. The cost of equity $($discount rate$)$ of ABC is $9\mathrm{.}1\%.$

A$)$ Compute the earnings per share and dividends per share of ABC for the years

$1$ to $10.$

B$)$ Calculate the theoretical value $($fair price$)$ of ABC stock. Then

justify whether ABC stock is overvalued or undervalued. Would you recommend that the shareholders of ABC buy other shares or no;

Please show workings in excel.