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Assume that Bettys's current dividend Do is $1.00; it is expected to grow 15% the first year, 20% the second year, 10% the third year,

Assume that Bettys's current dividend Do is $1.00; it is expected to grow 15% the first year, 20% the second year, 10% the third year, and return to its long-run constant growth rate of 4%. Cost of equity, or required rate of return is 7%.

  • What is the stock’s horizon terminal value?
  • What is the stock's intrinsic stock price today?

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