Hi, I was having a great amount of difficulty with this Finance question In particular as I am unable to understand where the 12.324% for the fourth and fifth year is coming from. I am also unsure as to how the 5.214% came about for the sixth year. I used the EPS equation that I know while basing off previous years, but get an incorrect value and am unsure if I am missing something in the equation.

I am just hoping to understand how everything is calculated in the mini table below either using Excel or manually and how the final stock price was found?

Thank you so much for all your help!!

Halliford Corporation expects to have earnings this coming year of $2.840 per share. Halliford plans to retain all of its earnings for the next two years. Then, for the subsequent two years, the firm will retain 52% of its earnings. It will retain 22% of its earnings from that point onward. Each year, retained earnings will be invested in new projects with an expected return of 23.7% per year. Any earnings that are not retained will be paid out as dividends. Assume Halliford's share count remains constant and all earnings growth comes from the investment of retained earnings. if Halliford's equity cost of capital is 9.2%, what price would you estimate for Haliford stock? Year EPS growth rate (versus prior year) EPS Retention ratio Dividend payout ratio Dividends $2.840 100% 23.7% $3,513 100% 23,7% $4.346 52% 48% $2.086 12.324% $4 882 52% 48% $2.343 12.324% $5.484 22% 78% $4 278 5.214% $5.770 22% 78% $4.501 0% 0% $0.00 $0.00 From year 5 on, dividends grow at a constant rate of 5.214%. Therefore, $4.278 PV4 0.092 -0.05214 - $107.326 The stock price will be the present value Diva Div4 +PVA Po =PV0 *(1+r) 3 (1 + r) 4 - $2.086 $2.343 + $107.326 (1+0.092) 3 (1 +0.09274 = $78.73