Facebook has gone public by issuing equity. As an analyst for a bank, you've estimated that the company will have a Beta of 1.2. You know that Facebook just gave a dividend of $4.00 per share. You anticipate high growth of this dividend for the first few years. You predict that dividends will grow by 20% for three years. After that, you anticipate growth to be a more modest 5% per year. The risk-free rate is 2% and the average return of the market is 13%.

1. What is the expected price TODAY of Facebooks stock?

2. In two years, what is the anticipated price for Facebook's stocks per share?

3. What is the expected price of the stock next year?