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Devon Oil Services suffered a large loss and suspended its dividend. Suppose you do not expect Devon to resume paying dividends until December 1, 2021.
Devon Oil Services suffered a large loss and suspended its dividend. Suppose you do not expect Devon to resume paying dividends until December 1, 2021. You expect Devon's annual divi- dend in 2021 to be $0.40, and you expect the annual dividend to grow by 5% per year thereafter. If Devon's equity cost of capital is 11%, what is your expected value of a share of Devon for December 1, 2018
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