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Investors expect that AZ company will pay a dividend of $1 each year for the next 5 years. After which, the dividends will grow at
Investors expect that AZ company will pay a dividend of $1 each year for the next 5 years. After which, the dividends will grow at the rate of 2% into perpetuity. The beta is estimated to be 1.5, the market risk premium is 10% and the risk-free rate is 2%. Find the value of this share. (Addition: find the price of this share in year 7 and assume that the share will be priced to yield of 8%)
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