Question
Ladder Co. is expected to pay a dividend of $2.65 per share, one year from today. The company will increase its dividend by 10 percent
The company will increase its dividend by 10 percent per year for the following
two years (dividends received two years and three years from now). The annual
growth rate will then slow to 5% for all future dividends (those occurring 4+
years from now). If the required return on Ladder stock is 10 percent, what
should the share price of the company be today?
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