Calculate the intrinsic value of ABC Corp using a three$-$stage dividend model assuming:

The current dividend $-$ D $0)$ is $$5$ per share, EPS$(0)$ is $$25$ and the current payout ratio is $20\%$

$-$starting next year, the company will increase the payout ratio by $10$ percentage points per year

$($ex$.$ from $20\%$ to $30\%)$ for the next $3$ years.

The earnings per share is expected to grow $10\%$ per year for the next $3$ years

The earnings per share is expected to grow $8\%$ for years $4-5($the payout ratio will not change

from year $3.$

$-$The dividends per share in year $6$ and beyond is expected to grow at a constant rate of $3\%$

The required rate of return is $10\%$

hint: DPS $=$ EPS $x$ POR