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Jimmy Co. just paid a dividend of $3.00 on its stock. The growth rate in dividends is expected to be 30% in the up period,
Jimmy Co. just paid a dividend of $3.00 on its stock. The growth rate in dividends is expected to be 30% in the up period, which lasts from year 1 to year 5. The growth rate will then drop to -5% in the down period that lasts from year 6 to year 7. It will then stabilize at 4% thereafter. Jimmy Co. investors require a 15 percent return on the stock for the first five years, a 12 percent return for the next three years, and then a 9 percent return thereafter. What is the current share price for Jimmy Co.?
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