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Blue Sky Corporation recently paid its annual dividend of $3.78, and reported an ROE of 5%. The firm pays out 50% of earnings as dividends.

Blue Sky Corporation recently paid its annual dividend of $3.78, and reported an ROE of 5%. The firm pays out 50% of earnings as dividends. Based on your analysis, you estimate that the stock has a required return of 11%. What is the intrinsic value of this stock?

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