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Laurel Enterprises expects earnings next year of $4.49 per share and has a 40 % retention rate, which it plans to keep constant. Its equity
Laurel Enterprises expects earnings next year of $4.49 per share and has a 40 % retention rate, which it plans to keep constant. Its equity cost of capital is 9 %, which is also its expected return on new investment. Its earnings are expected to grow forever at a rate of 3.6% per year. If its next dividend is due in one year, what do you estimate the firm's current stock price to be?
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