Question
Bull and bear inc. expects to grow its business in the first 3 years and then the business expects the growth to decline after. the
Bull and bear inc. expects to grow its business in the first 3 years and then the business expects the growth to decline after. the company just paid its annual dividend of $1 per share and is planning to increase its annual dividend by 10% for the next 3 years and then dividend will decline at an annual constant rate of 4% forever. 1.what is the value of B&B stock today if the required return is 12%? 2. what would be the impact on B&B stock price if the business expects the growth will not decline after 3 years, therefore management would maintain the same dividend as that of year 3?
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